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THE 

WAR OF 1812 

IN CONNECTION WITH 

THE A R M Y BILL ACT 



BY 

JAMES STEVENSON 

GENERAL MANAGER OF THE QUEBEC HANK 






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CONTENTS. 

CHAPTER I. 

Declaration of War — Embargo — Meeting of Provincial Parliament — 
Introduction of the Act— Legal tender coins— Price of gold — 
Capture of Detroit — Death of General Brock. 

CHAPTER II. 

Meeting of Provincial Parliament — Speech of the Governor General 
— Enlargement of the Act — Steamboat service between Quebec and 
Montreal— Capture of York — Further enlargement of the Act. 

CHAPTER III. 

Americans prepare to continue the war — Treaty of peace — Report 
on Army Bills in circulation — Bills lost or destroyed, ^9000 — Final 
close of the Army Bill Office. 



PREFACE. 



In the winter of the year 1874 Mr. James Stevenson 
delivered a lecture on the Card Money of Canada during 
the French domination, and in the winter of 1876 another 
lecture on the Currency of Canada after the capitulation, 
both of which were published in the Transactions of the 
Literary and Historical Society. In the concluding para- 
graph of the last lecture he stated : " On some future occa- 
sion I will proceed with my subject. "We have now reach- 
ed the most interesting part of our financial history — that 
which is related to the war of 1812, when our Militia and 
our monetary resources were taxed to the utmost. I shall 
leave others to deal with the incidents of the war : it will 
be my endeavour to show how the exigencies of the Army 
were provided for under circumstances particularly trying, 
by the creation of a Government Bank of Issue, which all 
writers on Canadian history have alluded to ; but which 
few, if any, have described in its operations, from its incep- 
tion to its close on the return of peace." Mr. Stevenson 
redeemed his pledge last winter by delivering a lecture 
before the Society on The War of 1812 in connection with 
the Army-bill Act, which lecture, with some additions, 
divided into three chapters, we now publish. This lecture 
completes the history of the currency of Canada, as given 
by Mr. Stevenson up to the time that Banks were establish- 
ed, viz. : — 

The Montreal Bank in 1817. 

The Quebec Bank in 1818. 

Quebec, 10th August, 1892. 




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future date. 



THE 



CIRCULATION OF THE ARMY BILLS 



WITH SOME 



REMARKS UPON THE WAR OF 1812. 



CHAPTER I. 



Declaration of War — Embargo on Goods — Meeting of Provincial 
Parliament — Introduction of the Act — Legal tender coins— Capture 
of Detroit — Death of General Hrock. 



!*X*t Bon pour U)IX Phi/Ires. X (f) 

L. Ah 



Army BilfOGce, Quebec, 
March, 1SU. 

C^lB^aJlLLaiR^, redeemable at this Office, 
by Government 'Bills' Of ^.I'cjjap.fje on London, ar 
Thirty Days Sight. 



Entered, 



Fifty Shillings, (f) L. N' 



By Order cf the Commander cf ibs Force*, 





THE 

CIRCULATION OF THE ARMY BILLS 



WITH SOME 



REMARKS UPON THE WAR OF 1812. 



CHAPTER I. 



Declaration of War — Embargo on Goods — Meeting (if Provincial 
Parliament — Introduction of the Act — Legal tender coins — Capture 
of Detroit — Death of General Brock. 

The American declaration of war was received in 
Quebec on Monday, the 29th June, 1812. On the 
30th, a proclamation was issued by His Excellency 
Sir George Prevost, requiring all American citizens to 
depart from the Province within fourteen days ; and, 
by order of police, within seven days from the city 
and district of Quebec. Great activity prevailed in 
the city in putting into operation the means of defence 
at the immediate disposal of the government, which 
consisted of the ordinary peace establishment of the 
British troops in the Province and the colonial forces. 



8 Declaration of War. 

A militia general order was issued by the Adjutant- 
General, F. Vassal de Monviel, from the headquarters 
in Montreal on the 6th July, ordering the battalions 
of militia throughout the Province to hold themselves 
in readiness to be embodied, and to march on the 
shortest notice to such points as the safety of the 
Province might require. In Quebec the militia of 
the city mounted guard in company with the regular 
troops, and each battalion continued to furnish a pro- 
portion of its number daily for garrison duty. The 
flank companies belonging to the militia battalions of 
Montreal, were formed into a battalion under Lieut- 
Col. Auldjo and Lieut-Col. Guy. A proclamation 
was issued by General Isaac Brock, Governor of Upper 
Canada, from his headquarters, Fort George, on the 
22nd July, announcing the invasion of the Province 
by the Americans, with the intention, he said, of con- 
quering Canada and restoring it to the Empire of 
France. "Are you prepared," he said, "inhabitants 
of Canada, to become willing subjects, or rather slaves 
to the despot who rules the nations of Europe with a 
rod of iron, — if not, arise," etc. 

On the 1 6th July, a temporary embargo was laid 
upon all goods, wares, moneys, merchandise and com- 
modities in and within the Province of Lower Canada ; 
upon all arms and ammunition ; upon scalping knives, 
daggers and Indian lances, bullion and specie of 
every description, none of which were allowed to be 
exported from any port within the Province of Lower 
Canada. All vessels were prohibited from sailing, 



Ulectiiig of Provincial Parliament. 9 

save such as were actually loaded or loading, and 
which were bound for any port in the United King- 
dom, or any of the colonies in America or the West 
Indies. The Provincial Parliament met on the same 
day, and His Excellency Sir George Prevost alluded 
in his speech to the fruitless endeavours of His 
Majesty for the preservation of peace ; to his implicit 
confidence in the loyalty of his subjects ; to their 
attachment to his person ; and to their ardent love for 
the true interests of their country. He observed 
with concern that the necessary establishments of the 
militia forces and the operations of the approaching 
campaign, would be attended with considerable 
expense ; but he relied implicitly upon their wisdom 
and public spirit for such supplies as the circumstances 
and exigencies of the affairs of the Province would 
be found to require. 

Loyal responses were made by the Legislative 
Council and House of Assembly on the 1 8th, the 
latter expressing itself prepared to grant such supplies 
as the exigencies of affairs might require. 

The people and authorities of Canada had for a 
long time been alive to the imminence of war ; but at 
the time of the declaration of war, Canada was in a 
comparatively defenceless state. To man the fort- 
resses of Quebec and Kingston, and to cover a frontier 
of 1,700 miles in length, the whole available force 
consisted of 4,450 regulars of all arms. In the Upper 
Province, which presents a war frontier of 1,300 miles, 
there were about 1,450 soldiers. The militia consisted 



10 Militia Muster. 

of about 2,000 men in the Lower, and 1,800 in the 
Upper Province. The total population of Upper 
Canada at this time was under 100,000, while that of 
the Lower Province did not exceed 300,000. 

On Sunday, the 19th July, orders for the whole of 
the militia of the Province to hold themselves in 
readiness to be embodied, was read on the Esplanade 
of the city of Quebec to the militiamen under arms. 
His Excellency was present on the occasion, and 
expressed his approbation of the zeal shown by the 
men in voluntarily doing duty with His Majesty's 
regular forces. 

To meet the pecuniary exigencies of the war the 
Provincial Parliament of Lower Canada, which assem- 
bled on the 1 6th July, i8i2,and remained in session 
till the 1st of August, being the third session of the 
seventh Parliament holden in Quebec, passed the Act 
to facilitate the circulation of army bills, which pro- 
vided as follows : 

First. That His Excellency the Governor, as Com- 
mander of His Majesty's forces, from time to time 
should cause to be prepared and made any number 
of bills, to be denominated army bills, containing 
one common sum, or different sums, in the principal 
moneys, not to exceed two hundred and fifty thousand 
pounds currency. Second. That such bills should be 
issued from an office to be called the "army bill 
office." Third. That the said army bills of twenty- 
five dollars each and upwards should bear interest at 
the rate of fourpence per centum per diem, upon or 



Army Bill Act. 11 

in respect of the several amounts of each. Fourth. 
That the principal sums of the said army bills of 
twenty-five dollars each and upwards should, at the 
option of the Commander of the forces, be payable 
on demand to the holders of such army bills, in cash 
or in Government bills of exchange on London, at 
thirty days' sight at the current rate of exchange. 
Fifth. That the interest of all such army bills of 
twenty-five dollars each and upwards, upon the pay- 
ment thereof in cash or in bills of exchange as afore- 
said, should be paid in army bills or in cash at the 
army bill office, at the option of the holders of such 
army bills. Sixth. That the principal sums of all 
such army bills of twenty-five dollars each and 
upwards, if paid in cash, should be paid at the army 
bill office; but if paid in government bills of exchange, 
should be paid at the office of the Commissary- 
General, upon a deposit in army bills of the amount 
of the bills of exchange to be so paid, and a certificate 
of such deposit under the hand and seal of the super- 
intendent of the army bill office to the Commissary- 
General. Seventh. That it will be advisable for His 
Excellency the Commander of the forces, from time 
to time to cause to be prepared and made, such num- 
ber of army bills of the value of four dollars each as 
he shall see fit, provided the said army bills of four 
dollars each and the said army bills of twenty-five 
dollars each and upwards do not together exceed the 
aforesaid sum of two hundred and fifty thousand 
pounds currency. Eighth. That the said army bills 



12 Army Bill Act. 

of four dollars each should be payable at the Army 
bill office in cash, to the bearer on demand. Ninth. 
That all army bills whatever should be issued as cash, 
upon the warrants of His Excellency as Commander 
of the Forces, to such person or persons, as he by 
such warrants shall see fit to direct such payments 
to be made. Tenth. That the current rate of ex- 
change should be established on oath once in every 
fortnight by five persons, to be named by His Ex- 
cellency, and publicly notified before any army bills 
whatever shall be issued. Eleventh. Makes provision 
for the cancellation of defaced army bills, and the re- 
issue of new army bills of same number, tenor and 
date as those cancelled. Twelfth. That no •army- 
bills should be re-issued, those of four dollars each 
excepted, and that all army bills whatever should at 
all times be redeemable by being called in and paid, 
both principal and interest in cash. And whereas 
His Excellency hath been pleased to prepare and 
cause to be prepared such army bills to the value of 
two hundred and fifty thousand pounds currency, 
which from time to time, as required, will be issued. 
And whereas it is the bounden duty of the Legis- 
lature to furnish every possible aid and assistance 
towards the defence of the Province, and to this end 
it is necessary to facilitate and support the circula- 
tion of all such army bills, be it enacted that the 
Governor, Lieut.-Governor or person administering, 
the Government be authorized and empowered to 
pay and allow or cause to be paid out of all moneys, 



Army Bill Act. L3 

customs, taxes and revenues of the Province, and in 
preference to all other claims and demands whatso- 
ever, all such interest at the rate of four pence per 
hundred pounds per diem as shall have arisen and 
grown due upon all every and any such arm}- bill 
which shall be so issued as aforesaid, not exceeding 
in the whole, the sum of fifteen thousand pounds 
currency per annum, which said interest shall run 
from the day of the date of such bill or bills, and such 
other charges as shall be necessarily incurred in, to 
or for the issuing, circulating or cancelling of the said 
army bills, not exceeding in the whole, two thousand 
five hundred pounds currency per annum. 

SECTION II. Provides that whatever moneys shall 
be issued out of the aforesaid moneys, customs, &c, 
shall be replaced out of the first supplies granted 
in the Provincial Parliament. 

III. Provides that the army bills shall be current 
in the revenue, and taken by all collectors, and receivers 
in the province, and that the same in the hands of 
such collectors and receivers, and in the hands of the 
Receiver-General shall be deemed as cash. 

IV. Provides that in payments to the revenue, 
interest shall be allowed to the day of payment, 
i.e., that the interest which from time to time shall 
be due upon any such army bill, shall be allowed 
to all persons, &c, paying the same to the Receiver- 
General or any collector or receiver up to the respec- 
tive days whereupon such bill or bills shall be so 
paid ; Provided always that even- such Receiver- 



14 Army Bill Act. 

General, collectors and receivers as aforesaid, shall be 
accountable for the interest on every such bill, so by 
them or either of them received for and during which 
such bill shall remain in their hands. 

V. Provides that all interest upon such army bills 
shall cease from and after the fourteenth day next 
after the day on which the same by any proclama- 
tion shall be called in to be redeemed in cash, and 
that money shall be reserved in hand for discharging 
the same. 

VI. Sets forth the penalty on forging army bills. 

VII. Enacts that all contracts shall be void in 
which any distinction shall be made between army 
bills and cash. 

VIII. No arrest if a tender in army bills be made. 

IX. No attachment shall issue if a deposit in Army 
Bills be made within the time limited by order of 
court. 

X. On capias ad satisfaciendum a deposit of the 
debt and costs in Army Bills shall stay proceedings. 

XI. On fieri facias, &c, a deposit of the debt and 
costs in army bills shall stay proceedings. 

XII. Provides relief for bills destroyed or lost in 
case of satisfactory proof of such destruction or loss 
being given, together with security for payment if the 
bill or bills certified to be lost, burnt or destroyed, 
shall be thereafter produced. 

XIII. Provides Provincial security for ultimate 
payment of army bills and loans in the following 
terms : And whereas there may be many persons 



Army Bill Act. 1." 

desirous of coming forward in aid of Mis Majesty's 
Government, with the loan of monies, who, having 
no commercial concern whereby to dispose of bills 
of exchange, and who, on that account may be 
deterred therefrom, for remedy thereof; be it enacted 
that from and after the expiration of five years after 
the passing of this Act, each and every the holder of 
any and every such army bill as may remain unpaid 
and unsatisfied shall be entitled to receive out of and 
from the monies that then may be in the hands of 
the Receiver-General of the Province, or from the first 
monies that may thereafter come into his hands 
arising out of any taxes or duties heretofore imposed 
or that may hereafter be imposed, levied or raised by- 
virtue of any Act or Acts of the Provincial legisla- 
ture, or from the rents and revenues of I lis Majesty's 
territorial domains in this Province, the full amount 
of all such army bills in money, with the interest 
remaining due thereon. 

XIV. Refers to the duty of the Receiver-General 
on the receipt and payment of arm}- bills, viz., that he 
shall pay over the same to the Commissary-Genera] 
for the time being and get from him the amount 
thereof in Government bills of exchange, at the current 
rate of exchange, or in cash at the option of the said 
Commissary-General, and the Receiver-General shall 
immediately thereafter render a true and exact 
account of all such payments and receipts to the 
Governor, in order that the same may be laid before 
the House of Assemblvat the next session thereafter. 



16 Army Bill Act. 

XV. And be it further enacted by the authority 
aforesaid, that for and during the period of five years 
from the passing" of this Act, no person whatever 
shall export or otherwise carry out of this province, 
any gold, silver, or copper coin of any description 
whatsoever, or any molten gold or silver in any shape 
or shapes whatever, and if any person whatever shall 
export or otherwise cany out of this province, or 
procure to be exported or otherwise carry out of this 
province, or shall in any manner or way whatsoever, 
attempt or endeavour to export or otherwise carry 
out of this province, or attempt or endeavour to pro 
cure to be exported or otherwise carried out of this 
province, any gold, silver or copper coin of any de- 
scription whatever, or any molten gold or silver in 
any shape or shapes whatever, then, in each and 
every such case, such gold, silver and copper coin, 
and such molten gold and silver shall be forfeited, 
one half to His Majesty, his heirs and successors, 
and one half to the person who shall sue for the 
same, and the same shall and may be seized, sued 
for, prosecuted, condemned and recovered in such 
courts, and by such and the like ways, means and 
methods, and the produce thereof disposed of and 
applied in such and the like manner, and to such and 
the like uses and purposes as any forfeiture incurred 
by any law respecting the revenue of the Customs 
may now be seized, sued for, prosecuted, condemned 
or recovered, disposed of or applied. 

XVI. Refers to action against the exporter of 



Army Bill Act. 17 

specie or bullion as follows : And be it further 
enacted that every person whatever, who, during 
the period of five years from the passing of this 
Act shall export or otherwise carry out of this 
province, or procure to be exported or otherwise 
carried out of this province, or shall put on board of 
any ship, or vessel, or boat, or into any land carriage 
to be exported or otherwise carried out of this province, 
or shall in any manner or way whatsoever attempt 
or endeavour to export or otherwise carry out of this 
province, or attempt or endeavour to procure to be 
exported any gold, silver, or copper coin of any 
description whatever, or any molten gold or silver, 
in any shape or shapes whatever, for every such 
offence over and above the forfeiture of such gold, 
silver and copper coin, and of such molten gold or 
silver, if the same shall be seized, shall forfeit the sum 
of two hundred pounds, and double the value of such 
gold, silver and copper coin, and of such molten gold 
and silver, one half to His Majesty, and one half to 
the person who shall sue for the same by bill, suit, 
action or information, in any of His Majesty's courts 
in this Province. 

XVII. Provides that nothing in the Act shall 
prevent persons taking out of the Province the sum 
of £10, or such further sum with license from the 
Governor. 

XVIII. Penalty on persons convicted of perjury. 

XIX. Refers to fines, &c, to be paid into the hands 



18 Army Bill Act. 

of the Receiver-General and to be accounted for to 

the Crown. 

XX. Refers to limitations of action. 
At the close of the session, on the ist of August, 1 812, 
the Provincial Parliament of Lower Canada presented 
to His Excellency Sir George Prevost, Baronet, the 
foregoing " Act to facilitate the circulation of army 
bills"" for the royal assent, which was duly given. 
The Honorable Speaker of the Assembly said : 
"They, the representatives of the Province of Lower 
Canada, are under the greatest obligation to your 
Excellency for having communicated to them the 
means to ameliorate and insure for several years the 
punctual payment of the army, by the circulation of 
bills, the reimbursement of which is guaranteed in 
England. To give them greater credit, this bill limits 
the^sum necessary, and moreover provides for the 
interest, the advantages accruing therefrom, and for 
the entire payment of the principal in specie in this 
Province, which has become expressly bound for the 
same at a fixed period." 

In connection with the establishment of the army 
bill office, a notification was made to the public by 
His Excellency, that James Green, Esquire, had been 
appointed Director, and Louis Montizambert, Esquire, 
Cashier, and that they had given the required security 
for the faithful performance of the trust reposed in 
them. The office was opened at the Court House, 
and from thence by order of His Excellency, an issue 
of army bills was made, consisting of the denomina- 



The Coins Current in Canada. 19 

tions, twenty-five dollars, fifty dollars, one hundred 
dollars and four hundred dollars ; signed by His 
Excellency the Commander of the Forces, by the 
Director, by the Military Secretary and made payable 
to the bearer, on demand, at the army bill office, in 
Government bills of exchange at the current rate of 
exchange or in cash, at the option of the Commander 
of the Forces, with interest. 

Prior to the passing of the " Act to facilitate the 
circulation of army bills " the currency of Canada con- 
sisted of a variety of coins. In the absence of a 
colonial coinage, the gold and silver coins of several 
nations were in circulation. Spanish, Portuguese, 
French and German, circulated simultaneously with 
the gold and silver coins of Great Britain. During 
the session of 1795, the following statute was passed, 
viz. : " An Act to prevent the diminution of specie 
circulating in this Province, that the same may be 
regulated according to a standard that shall not 
present an advantage by carrying it to neighbouring 
countries ; and whereas, by an ordinance now in 
force for regulating the currency of this Province, an 
advantage does arise by carrying gold coin out of the 
same, be it therefore enacted that the gold and silver 
coins hereafter mentioned, shall pass current and be 
deemed a legal tender in payment of all debts, and 
demands whatsoever in this Province, at the weights 
and rates following, that is to say : 



20 The Coins Current in Canada. 

Canada 
NAMES OF COINS Weighing. Currency. 

Dwts. Grains. £ s. d. 

The British guinea 5 6 I 34 

The Johannes of Portugal 18 4 00 

The Moidore of Portugal 6 18 1 10 o 

The Four Pistole piece of Spain 17 3 14 o 

The French Louis d'or coined before 1793 5 4 0180 

The American Eagle . 11 6 2 100 

With regard to silver, the American dollar shall 
pass current at five shillings currency, and every other 
coin current in the Province as already provided for, 
viz. : 

Canada 
Currency. 

The Spanish dollar at £0 5 o 

The British Crown 056 

The French Crown or piece of 6 livres Tournois 056 

The French piece of 4 livres, 10 sols 042 

Canada 
Currency. 

The British shilling .£0 1 1 

The French piece of 24 sols Tournois o 1 1 

Pistareen O 1 o 

The French piece of 36 sols Tournois o I 8 

A similar Act was passed by the Parliament of 
Upper Canada on the 3rd of June, 1796. 

Great inconvenience was experienced in conse- 
quence of the scarcity of specie, which gave rise to a 
kind of barter, or store pay, prejudicial to the interests 
of the farmers and labouring classes. Farm produce, 
furs, and labour were paid for in goods which had to 
be taken at unreasonably high prices at the shops or 
stores, because specie was hardly to be had. 

Under the Army Bill Act, however, a paper cur- 
rency was introduced, which proved of essential 



Circulation of Army Bills. 21 

service, not only in meeting the exigencies of the 
public service, but in facilitating commercial trans- 
actions. The measure proved, in practice, a complete 
success. Bills of the denominations $25, $50, $100 
and $400 were not re-issued. They bore interest, as 
provided for in the Act, $400, fourpence per diern, 
$100, one penny per diem, $50, one halfpenny per 
diem, and $25, one farthing per diem, being substan- 
tially interest at the rate of six per cent, per annum. 

Four dollar bills bore no interest, and they were 
re-issued. They were payable at the army bill office 
in cash on demand. 

Many years ago I ascertained from merchants who 
were engaged in the retail business in Quebec in 
1 81 2, and during the war, that the army bills circu- 
lated freely, the larger denominations with interest 
from the date of issue added. The calculation of 
interest which had accrued was an easy one : $400 
for 30 days was just 120 pence, equal to 10 shillings 
currency ; $100, 30 pence ; 50, 15 pence, and so on ; 
consequently the increased value of each bill was 
easily ascertained ; and it passed, with its increment, 
from one to another in the purchase of goods or settle- 
ment of account. 

The Act provided for the redemption of bills of 
$25 and upwards, in cash or exchange on London, at 
30 days sight, at the option of the Commander of the 
Forces, at the current rate of exchange ; but the 
interest which had accrued on all such bills was paid 
in cash or exchange at the option of the holder. 



22 Rate of Exchange. 

The current rate of exchange for bills on London 
at 30 days sight was established once in every fort- 
night, by a committee of five persons named by His 
Excellency. 

The rate of exchange for bills on London, in con- 
sequence of the suspension of specie payments by the 
Bank of England, which took place in 1797, and which 
lasted till 1823, was very low. This subject, however, 
has to be considered in connection with the price of 
gold in England. 

The mint price of an ounce of Standard gold is £3 
17s. ioj4d., being one-twelfth part of £46 14s. 6d. the 
value set upon a pound weight of gold. 

During the Napoleonic wars, the price of gold in 
England per ounce rose, in 1800 to £4. 5s. currency ; 
in 1809 to £4. ns. ; in 1810 to £4. 19s. ; and in 1812, 
when Napoleon was in the zenith of his power, to 
^5. 10s. British currency. In order therefore to effect 
a settlement in Canada on a specie basis, bills drawn 
at 30 days sight on the Treasury in London, were 
subject to a large discount, frequently as much as 22%, 
as determined by the committee appointed by His 
Excellency to regulate the rate of exchange. Con- 
sequently, a bill at 30 days sight for ^"100, at that 
rate, yielded only £78 sterling, equal to $356.46 in 
specie. In 18 12 ,£100 sterling in gold in England 
was worth ^120 4s. 9d. ; in 181 3, .£100 sterling in 
gold was worth ^"122. 18s. currency of Great Britain. 

It has to be borne in mind that the dollar in gold 
of 1812, was of greater value than the dollar in gold 



The War. 23 

of the present day, on account of its greater weight 
and fineness. It required only $4.57 to constitute 
the par of the pound sterling in 1812 ; whereas it 
requires $4.86^3 to constitute the par now, being 
Q X A°/ over the ninth or old par of Oueen Anne. In 
other words, the American eagle of 1792 contained 
247^2 grains of fine gold — -the American eagle of 
1837 contains only 232.2 grains of fine gold. There 
has been no change since that year in the quality or 
weight of the American eagle. 

In the early part of August 18 12, the war, both by 
land and sea, began to assume its proper character. 
The American General, Hull, with a strong force, 
crossed from Detroit to the Canadian shore on the 
1 2th of July. Hull, however, had calculated upon 
a friendly reception in Canada, but found the people 
hostile ; and, being warned of the advance of General 
Brock with a force of over 300 regulars, 400 militia, 
and several hundred Indians, lead by Tecumseh, made 
a hasty retreat, recrossed the river and occupied his 
old quarters in Detroit. General Brock, however, 
with characteristic daring, crossed in pursuit, attacked 
and captured the town with t>1 pieces of cannon, and 
the military chest ; and took General Hull and 2,500 
troops prisoners of war. 

During the autumn, several raids were made along 
the frontier of the Upper St. Lawrence, and at other 
points ; but none of them of any importance, and 
none of them very creditable to either part)'. The 
Americans were repulsed at Presqu'ile on September 



24 Quccnston Heights. 

the 1 6th ; Gananoque was raided by Americans on 
the 2 ist ; the British were repulsed at Ogdensburg 
on October the 4th ; and several British craft were 
captured off Black Rock, Lake Erie, on October 
the 9th. 

In the early part of October, however, viz., on the 
1 2th, General Van Renselaer, in command of a con- 
siderable force of American regulars and militia on the 
Niagara frontier, prepared to attack the British at 
Queenston, opposite Lewiston. He considered his 
forces, ample to secure success. They numbered more 
than six thousand. The British force on the Western 
bank of the Niagara river, regular, militia, and Indians, 
numbered fifteen hundred. The Indian allies, under 
John Brant, numbered about two hundred and fifty 
strong. In addition, there was a detachment of the 
41st regiment, 380 strong, under Captain Bullock, and 
the flank companies of the 49th regiment. 

The Americans effected a landing, notwithstanding 
a desperate resistance made by the British, and 
occupied the heights after a hot engagement, in which 
the gallant Brock lost his life ; but they were finally 
defeated and driven over the precipitous banks of the 
Niagara river at the point of the bayonet. About 
i,ioo Americans, officers and privates, surrendered 
unconditionally as prisoners of war. 



CHAPTER II. 

Meeting of Parliament — Speech of the Governor — Enlargement of the 
Act — Steamboat service between Quebec and Montreal — Capture of 
York — Further enlargement of the Act. 

The Provincial Parliament of Lower Canada was 
summoned for the despatch of business on the 29th 
December, 18 12. In the Speech from the Throne, 
His Excellency Sir George Prevost said : — 

"The complete discomfiture of the plans of the 
enemy for the conquest of Upper Canada, by the 
capture of Detroit, and by the surrender of the whole 
invading army with its general ; the brilliant achieve- 
ment at Oueenston, tho' clouded by death in the 
hour of victory, of the gallant and much lamented 
Major-General Brock, together with other recent 
advantages gained over the enemy, both in Lower 
and Upper Canada, are subjects of sincere congratu- 
lations, and demand our fervent acknowledgments 
to the Great Ruler of the Universe for these unde- 
served mercies. 

" I take also pleasure in acquainting you that the 
measure of the issue of army bills, for the circulation 
of which you so promptly and liberally provided 
during the last session, has been attended with the 



26 Meeting of Parliament. 

happiest effects, both by powerfully aiding His 
Majesty's Government to meet the extraordinary 
demands of the present crisis, and by materially 
facilitating commercial transactions. The experience 
of four months having fully shown the utility of the 
measure, I recommend to your consideration the 
adoption of such further regulations and provisions 
respecting it, as, upon a review of the Act passed 
upon this head, and of the present circumstances of 
the country, may appear to be necessary." 

It is manifest, I have said, that the Act to facilitate 
the circulation of army bills, proved a complete 
success ; but a much larger amount of notes than that 
authorized by the Act had been issued during the 
recess ; and the exigencies of the public service 
rendered it necessary to resort to a further increase 
of issue. 

At the fourth session of the seventh Parliament 
holden in Quebec the 29th December, 181 2, " An Act 
to extend the provisions of an Act passed in the 
fifty-second year of His Majesty's reign, intituled, 
An Act to facilitate the circulation of army bills, 
and to make further regulations respecting the same," 
was passed, and received the royal assent on the 15th 
February, 18 13. The Act reads as follows : 

I. Whereas an Act was made and passed in the 
fifty-second year of His Majesty's reign, intituled, 
"An Act to facilitate the circulation of army bills ;" 
And whereas it appears by a message of the Governor- 
in-Chief to the House of Assembly of the 8th 



Enlargement of the Army Bill Act. 27 

January, 1813, that the exigencies of the public 
service have rendered it indispensably necessary for 
him as Commander-in-Chief to direct an issue of the 
army bills to be made to a greater amount than two 
hundred and fifty thousand pounds provided for by 
the said Act, and that the further exigencies of the 
public service may render a further issue indispensably 
necessary ; and whereas it is expedient to subject 
such army bills as have been so issued, as well as 
such as may be hereafter issued, to the provision's, 
regulations, and enactments of the afore-recited Act, 
and to make further provisions and regulations 
respecting the same ; Be it therefore enacted by the 
king's most Excellent Majesty, by and with the 
advice and consent of the Legislative Council and 
Assembly of the Province of Lower Canada, consti- 
tuted and assembled, by virtue of and under the 
authority of an Act of the Parliament of Great Britain, 
passed in the 31st year of His Majesty's reign, 
intituled " An Act to repeal certain parts of an Act 
passed in the 14th year of His Majesty's reign, 
intituled, " An Act for making more effectual provision 
for the government of the Province of Quebec ; 
in North America ; " " and to make further provision 
for the government of the said Province, and it is 
hereby enacted by the authority of the same, that all 
army bills which have been so issued after the time 
at which the army bills then issued, amounted to the 
sum of two hundred and fifty thousand pounds, and 
each and every of them and all such army bills as 



28 Enlargement of the Army Bill Act. 

shall be issued during the next twelve months, from 
and after the passing of this Act, shall be deemed and 
taken to be within the purview of the Act made and 
passed in the 52nd year of His Majesty's reign, 
intituled, " An Act to facilitate the circulation of 
army bills ; " and that all the provisions, regulations 
and enactments in the said last-mentioned Act con- 
tained, and each and every of them, shall be applied 
and put in force in respect to all and every such 
army bills so issued, or that may hereafter be issued, 
as fully and effectually to all intents and purposes as 
if the same were severally and separately repeated, 
and herein recited, and made part of this Act under 
the restrictions hereinafter mentioned. 

II. Provides for the payment out of all and every 
and any the moneys, customs, taxes and revenues of 
this province, and in preference to all other claims 
and demands whatsoever, all such interest at the rate 
of fourpence per one hundred pounds per diem, as 
shall arise and grow due upon all and every and any 
army bill or bills, which have been issued, or shall 
hereafter be issued. 

III. Provided always that the sum so to be paid 
out of and from the customs &c. aforesaid, with inter- 
est as aforesaid, shall not on the whole and together 
exceed the sum of fifteen thousand pounds currency 
per annum. 

IV. Provided also, and be it further enacted by the 
authority aforesaid, that the amount of army bills in 
circulation as well as those already issued or such as 



Enlargement of the Army Bill Act. 29 

may be hereafter issued, shall not at any one period 
exceed the sum of five hundred thousand pounds 
currency. 

V. And be it further enacted by the authority 
aforesaid, that interest upon such army bills as have 
been, or shall hereafter be issued, shall run from the 
day of the date of such bill or bills, until the same 
shall be paid, and that the holder or holders of every 
such bill or bills shall be entitled to demand and 
receive payment of all such interest at stated periods, 
once in every six months, at the army bill office in 
the city of Quebec, and further, that public notifica- 
tion shall be given in the Quebec Gazette immedia- 
ately after the passing of this Act, by order of the 
Governor, Lieutenant-Governor, or the person ad- 
ministering the government for the time being, of the 
periods at which such payments shall be made. 

VI. And whereas it is expedient in order that the 
public confidence in such army bills may remain 
undiminished, that the holders thereof may be assured 
of the punctual payment of all interest that may 
become due and payable on army bills ; and whereas 
the sum of fifteen thousand pounds per annum herein 
before provided, may not suffice for the full payment 
thereof on the whole amount of bills so issued or to 
be issued, Be it therefore enacted, by the authority 
aforesaid, that the provisions, regulations and enact- 
ments of the Act herein before cited, intituled, " An 
Act to facilitate the circulation of army-bills, " shall 
not extend or be construed to extend to a greater 



30 Enlargement of the Army Bill Act. 

amount of army bills in circulation at any one time, 
during the next twelve months after the passing of 
this Act, than two hundred and fifty thousand pounds 
currency, unless public notification shall be given in 
the Quebec Gazette within one month after the 
passing of this Act, by the Commander of His 
Majesty's forces in this province for the time being, 
that all such interest as aforesaid shall be paid at the 
army bill office at the like stated periods. 

VII. And be it further enacted, that the five Com- 
missioners heretofore appointed for the purpose of 
certifying the current rate of exchange, at which bills 
of exchange on London were and are to be given in 
payment of army bills, and their successors, or any 
three of them, shall continue to meet and certify 
under Oath the rate of exchange in like manner, and 
that in due execution of their office, as aforesaid, 
they shall be guided by the fair current rate of bills 
of exchange at thirty days' sight, and by all such 
other information as they may be able to procure, so 
as to enable them to do substantial justice to the 
holders of such bills, and to the government. 

VIII. And be it further enacted, that it shall be 
the duty of the officer or officers to whom it may 
appertain as having the direction of the army bill 
office, to lay before the Commissioners immediately 
after the passing of this Act, a correct account of the 
amount of all such army bills as shall then be in 
circulation, and at each second subsequent meeting 
of the said Commissioners, a true and correct account 



Enlargement of the Army Bill Act. 31 

of all such bills as shall have been issued and put 
into circulation from the date of the last account 
rendered, in order that the same may be laid before 
the Legislature, at its next ensuing meeting. 

IX. And be it further enacted, that all sheriffs 
and bailiffs who shall or may receive army bills upon 
execution, shall be accountable for the interest on all 
such bills which by them or any of them shall be so 
received for, and during the time that such bills 
remain in their hands, to the persons interested 
therein, and to this end the said sheriffs and bailiffs 
shall mention in their respective returns, whether 
they received the amount or any part of the amount 
of such executions in money or in such bills, and also 
the day on which they received it. 

X. And be it further enacted, that no public 
officer whatsoever shall profit by the interest on the 
army bills which may be placed in his hands as such 
public officer, to be given in payment, and shall 
render an account of the said interest, annually, on 
the first day of November, to the Receiver-General 
to be employed according to the dispositions of the 
fourth section of the aforesaid Act, passed in the fifty- 
second year of His Majesty's reign. 

XI. And be it further enacted, that the interest 
for which the Receiver-General and collector and all 
public officers are accountable to the province, shall 
be employed and applied in the payment of the 
interest wherewith the Province is by this Act 
charged. 



32 Enlargement of the Army Bill Act. 

XII. Provided always, and be it further enacted, 
that nothing in this Act contained shall extend or be 
construed to extend or entitle any holder or holders 
of any such army bills as aforesaid, as may at any 
time hereafter remain unpaid or unsatisfied (save and 
except the holder or holders of such army bills as 
were heretofore issued, subsequent to the passing of 
the Act to facilitate the circulation of army bills and 
until the same exceeded in the whole the sum of two 
hundred and fifty thousand pounds, and which now 
remain unpaid and unsatisfied) to receive out of or 
from any monies that may then be in the hands of 
the Receiver-General of this Province, or from any 
monies that may hereafter come into his hands 
arising out of any taxes or duties heretofore imposed 
or that may hereafter be imposed, levied, or raised by 
virtue of any Act of the Provincial Legislature, or 
from the rents and revenues of His Majesty's terri- 
torial domains in this province, or from any other 
monies in the hands of the Receiver-General, pay- 
ment of any such army bill or bills, as aforesaid. 

XIII. And be it further enacted, that should the 
Governor-in-Chief deem it expedient, to cause the 
whole or any part of the army bills to be hereafter 
issued to be signed by any other person or persons, 
by and under his authority ; public notice shall be 
given during one month in the Quebec Gazette, of 
the name or names of such person or persons so 
authorized, and that all army bills signed by such 
person or persons, shall be considered as forming 



Enlargement of the Army Bill Act. 33 

part of the sum of five hundred thousand pounds, at 
which the whole amount of army bills to be circu- 
lated at the same period is hereinbefore limited. 

XIV. And be it further enacted, that the sum of 
five hundred thousand pounds, at which the amount 
of army bills to be in circulation at one period is 
limited, such amount may be issued in army bills of 
one, two, eight, ten, twelve, sixteen and twenty dollars 
each, as the Commander of the forces may deem 
expedient and necessary, such bills bearing" no interest 
and payable in cash on demand at the army bill 
office. Provided always that the amount of such 
bills, and of bills of four dollars each, shall not in the 
whole and together exceed the sum of fifty thousand 
pounds. 

XV. And be it further enacted, that it shall and 
and may be lawful for the Governor, as Commander 
of the forces, to establish such other office or offices 
at Montreal or elsewhere in the Province as to him 
may seem expedient and necessary for the payment 
of all such bills as have, or may hereafter be issued, 
payable in cash on demand. Provided that the whole 
expense thereby incurred, together with the expense 
of the office already established, do not in the whole 
exceed the sum of two thousand live hundred pounds 
per annum, appropriated by the Act herein before 
mentioned. 

The following is a copy of advertisement respecting 
the adjustment of the rate of exchange : 



34 Rate of Exchange. 

"Quebec, 15th March, 1S13. 

"The Commissioners appointed by I lis Excellency Sir George 
Prevost, Governor-in-chief and Commander of the Forces, in virtue of 
the Provincial Act of the 52nd year of His Majesty's reign, intituled, 
"An Act to facilitate the circulation of army bills,' (the provisions 
thereof being extended, and further regulated by an Act of the 53rd 
year of His Majesty's reign) have fixed on the rate of exchange for 
government bills, at 30 days sight, at twenty per cent for the next 
fortnight from this date." 

N.B.— "The said Commissioners meet every Monday fortnight at 
10 o'clock, at the house of Mr. Blackwood, St. Louis Street, where 
written communications on the subject of exchange will be received 
and duly attended to.'' 

The army bills of the denominations $400, $100, 
$50 and $25, were signed, as I have already stated, 
by His Excellency as Commander of the forces, by 
the Director, and by the Military Secretary, and 
made payable as provided for in the Act. The four 
dollar bills were signed by the director of the Army 
bill office, the Cashier and the military secretary only. 

The whole of the bills were deposited in the mili- 
tary chest, from whence they were issued in payment 
of whatever demands were required to be made on 
the Commissary-General or Paymaster-General, on 
account of the public service. 

The signing of these bills by His Excellency was 

apparently found jnconvenient, for, under date of 

23rd March, 1813, I find the following notice: 

" Plis Excellency has directed that public notice be given, and the 
same is hereby given, that all such army bills, will, from and after the 
24th clay of April, instead of bearing the signature of His Excellency 
the Commander of the forces, be signed under the authority of His 
Excellency, by James Green, Esquire, director of the said army bill 



Army Bill Office. 35 

office, or by the director of the said office for the time being, by the 
command of His Excellency, and by Louis Montizambert, Esquire, 
cashier of the said office for the time being, and by those persons only." 
And on the 22nd of April, further notice is given 
as follows : 

"And whereas certain army bills now bearing my signature still 
remain to be issued, and will be issued, notwithstanding the said 
notification, after the said 24th instant. I have therefore thought fit, 
by this proclamation, to make known the same, and the same is hereby 

made known accordingly." ,-;.,„„ e.„ 

B ' Given oca, 

Signed. George Prevost. 
In 1813 the passenger traffic or intercourse between 
Quebec and Montreal was carried on by a line of 
stages, which set out every morning at four o'clock 
during the summer season, Mondays excepted ; but 
in the early part of May a steamer, named the 
" Swiftsure," was put on the river line. She started 
from Montreal at five o'clock on Saturday morning, 
anchored at eight o'clock the same evening near 
Three Rivers, which she left on Sunday morning at 
five o'clock, and arrived at the King's Wharf, Quebec, 
at half-past two ; being only about twenty-four hours 
and a half under way between the two cities, with a 
strong head wind all the way. The advertisement 
sets forth that she is superbly fitted up : " twenty-two 
berths in the great cabin, each sufficient for two 
passengers, besides four for ladies in the state room, 
and a separate room for families. In the steerage, a 
great number of passengers can be accommodated. 
America cannot boast a more useful and expensive 
undertaking by one individual than this of Mr. 
Molson." 



36 Blockade of Ports. 

" His Excellency the Governor-in-Chief set out for 
Montreal on Tuesday afternoon in the Steam Boat." 

On March the 20th, 181 3, it was announced by the 
Foreign Office in London that the necessary measures 
had been taken for the blockade of the ports and 
harbours of New York, Charleston, Port Royal, 
Savannah, and of the river Mississippi. There was 
no lack of energy on either side in the prosecution 
of the war. Great activity prevailed in the port of 
Quebec. Between the 5th and 16th of June, sixty- 
one vessels in all arrived ; twenty-six in ballast, six- 
teen with general cargoes, five with government 
stores, and thirteen with passengers and troops ; the 
troops consisted of the Wattville regiment, the 89th, 
the 104th ; and one vessel had soldiers belonging to 
different regiments and some artillery on board. 
Halifax was also a busy port during the war ; there, 
ships of war held themselves ready for any emer- 
gency ; thither ships of war and privateers took 
the prizes taken at sea. In the cargo of one prize, 
the " Marquis cje Somerlos," a case containing 
twenty-one paintings and fifty engravings, shipped 
by a Mr. J. A. Smith, was found, addressed, " To the 
Academy of Arts, Philadelphia" a gift to that insti- 
tution. The authorities at Halifax released the works 
of art and forwarded them to Philadelphia, " with the 
sincerest wishes for the success of the infant society," 
— in striking contrast to the conduct of Napoleon, 
who plundered the National Galleries of Europe, not 
even sparing the Vatican, and sent the paintings and 



Capture of York, Toronto. 37 

statuary to Paris. But time at last makes all things 
even. "The Transfiguration and the Last Communion 
of St. Jerome resumed their place in the Vatican ; the 
Apollo and the Laocoon again adorned the precincts 
of St. Peter's ; the Venus was enshrined anew amid 
beauty in the tribune of Florence ; and the Descent 
from the Cross, by Rubens, was restored to the 
devout worship of the Flemings in the Cathedral at 
Antwerp." 

The xA.mericans were nothing daunted by the reverse 
at Oueenston. The authorities, as well as the writers, 
spoke of the death of Brock as equivalent to a 
victory. At the end of April, 1813, a joint land and 
naval expedition was organized to capture York (now 
Toronto) the capital of Upper Canada. The American 
fleet appeared before the town on the 26th, conveying 
a land force of 2,500 men. Toronto had for defence, 
under Major-General Sheaffe, less than 600 men, 
consisting of regulars and militia. General Pike, of 
the American army, at the head of a division of at 
least 1,000 strong, landed, in spite of a spirited resist- 
ance. The Americans swarmed into the old French 
fort and harbour defences, fiery with fighting, and 
flushed with success, when suddenly, — with the crash 
and concussion of an earthquake, — the powder maga- 
zine exploded at their feet, spreading havoc through 
their ranks. Of the assailants, 250 were instantly 
killed or wounded, — General Pike amongst the killed ; 
of the defenders many perished. The contest itself 
was stayed by the catastrophe ; it had endured eight 



38 Americans Victorious. 

hours. The surviving British troops had withdrawn ; 
all that could be done had been done, and York 
capitulated through the local officers of militia. 
Sheaffe left behind him, of regulars sixty-two killed 
and seventy-two wounded. The Americans kept 
possession, but evacuated York on the 2nd of May, 
1813* 

The complete victory of the Americans over the 
British at York atoned in some measure for the 
reverse they had suffered at Queenston Heights. I 
might now allude to the success of the Americans at 
sea, to their victory over the British frigate Guerriere; 
to the naval duel between the British ship Shannon 
and the American Chesapeake, to the defeat and 
capture of the latter after a sanguinary engagement ; 
but it is not my intention to refer to the stirring 
events of the war, further than may seem to me desir- 
able to show the necessity which existed for the 
Army Bill Act, and for the subsequent enlargement 
of its provisions to meet the exigencies of the public 
service. 

Several raids or attacks were made from both sides 
of the lines with alternate successes and defeats. 
Among the most memorable were the attack on 
Sackets harbour by the British, without any satis- 
factory result ; the capture of Fort George by the 
Americans ; the subsequent night attack by the British 
upon the American army encamped at Stoney-creek, 

* Colonel Coffin, " 1S12, Chronicle of the War." 



Chateauguay, Defeat of Americans. 39 

where deadly work was done with the bayonet, in 
the lurid light of the watch-fires, as the sleepers 
aroused, rose stumbling and dazed. Two American 
Generals, caught napping, and one hundred soldiers 
were made prisoners of war. The rest of the 
American Army made a hasty retreat, never halting 
till safe within the works of Fort George. But the 
most memorable of all the engagements was the 
battle of Chateauguay in October 1813, when a 
powerful invading force of Americans, bent upon the 
subjugation of Lower Canada, was beaten back and 
signally defeated by a small force, consisting chiefly 
of French Canadian militia, led by Colonel de Sala- 
berry. There was also a minor engagement at 
Cryslers farm, in which the Americans were defeated. 

The expenses connected with the war were so 
great that it is difficult to conceive how it could have 
been carried on without the operation of the Army Bill 
Act. We are, I believe, as much indebted to the 
authors of that measure for the preservation of our 
connection with the British Empire, as we are to the 
valour of our soldiers and sailors in repelling a cruel 
and unwarrantable invasion. 

The Provincial Parliament again assembled on the 
13th of January, 18 14. His Excellency Sir George 
Prevost, after alluding in his Speech from the throne 
to His Majesty's victorious arms in Europe, said: "In 
turning our eyes to our own shores, we have abundant 
cause for gratitude to the Supreme Giver of all good, 
for the termination of the late campaign in a manner 



40 Colonel de Salaberry. 

so glorious to the British arms, and so disastrous to 
those of the enemy. 

"The defeat sustained by him on the Chateauguay, 
where a handful of brave Canadians repelled a power- 
ful division of his army ; and the brilliant victory 
obtained by a small corps of observation on the 
banks of the St. Lawrence, (Crysler's farm) have at 
the same time upheld the honour of His Majesty's 
arms, and effectually disconcerted all the plans of 
the enemy for the invasion of the Province." 

On the 25th of January, 18 14, the thanks of the 
House of Assembly were voted to Lieutenant-Colonel 
de Salaberry, and to the officers and privates under 
his command in the engagement at Chateauguay on 
the 26th October, 1S13 ; and to Lieutenant-Colonel 
Morrison of the 89th regiment, and the officers and 
privates under his command at Crysler's farm on the 
1 ith November. 

On the 5th of February, the speaker informed the 
House that he had received from Lieutenant-Colonel 
de Salaberry a letter, in return to the thanks of the 
House to him, which he read. 

The letter is a remarkably able composition, of 
which I cannot refrain from inserting one paragraph : 

" In preventing the enemy from penetrating into the province, one 
common sentiment animated the whole of my three hundred brave 
companions, and in which I participated, that of doing our duty, serving 
our Sovereign, and saving our country from the evil of an invasion. 
The satisfaction arising from our success was to us adequate recom- 
pense ; but we now enjoy another of inestimable value, in the dis- 
tinguished honour conferred in the thanks voted to us by the House of 



Further Enlargement of the Army Bill Act. 41 

Assembly. This generous proceeding leaves in our minds an impression, 
deep, lively, and indelible. The country, through its representatives, 
evincing itself thus nobly grateful, requites the service of its children 
with the highest and most flattering reward." 

On the 17th of January, 1814, His Excellency sent 
a message to the House, stating that the exigencies 
of the public service rendered it necessary that he 
should direct a further and more extensive issue of 
army bills. Accordingly an Act, further to extend 
the provisions of the two Acts for facilitating the 
circulation of army bills, was introduced. 

The preamble runs as follows : — 

" Whereas an Act was made and passed in the 
fifty-second year of His Majesty's reign, intituled, 
'"An Act to facilitate the circulation of army bills,'" 
and whereas, another Act was made and passed in 
the fifty-third year of His Majesty's reign, intituled, 
"'An Act to extend the provisions of an Act made 
and passed in the fifty-second year of His Majesty's 
reign, intituled, "An Act to facilitate the circulation 
of army bills," and to make further regulations 
respecting the same,' " and that by the fourth clause of 
the last mentioned Act, it is provided and enacted, 
that no greater sum than five hundred thousand 
pounds currency in army bills, shall be in circulation 
at any one time. And whereas it appears by His 
Excellency the Governor-in-Chief's message to the 
House of Assembly of the 17th January, that the 
exigencies of the public service render it indispensably 
necessary that he, as Commander of the forces, should 



42 Further Enlargement of the Army Bill Act. 

direct a further and more extensive issue of army 
bills to be made. And whereas it also appears by 
the accounts of the Director of the army bill office 
laid before the House of Assembly, that a greater 
sum in army bills has been and now remains in circu- 
lation than the aforesaid sum of five hundred thousand 
pounds, and that it is expedient and necessary to 
extend the provisions of the said Acts to all such 
army bills as now are in circulation, and to a further 
issue to be made, to make further regulations respect- 
ing the same, and also to indemnify all persons 
concerned in the making and issuing of arm}* bills, 
over and above the said sum of five hundred thousand 
pounds ; be it therefore enacted, by the King's Most 
Excellent Majesty, by and with the advice and con- 
sent of the Legislative Council and Assembly of the 
Province of Lower Canada. It is hereby enacted that 
from and after the passing of this Act, all army bills 
issued heretofore and now in circulation, or which 
shall be made and issued at the army bill office in 
the City of Quebec, from and after the passing of 
this Act, until the first day of February, 1815, shall 
be deemed and taken to be within the purview of the 
Act made and passed in the fifty-second year of His 
Majesty's reign, intituled, "An Act to facilitate the 
circulation of army bills," subject, nevertheless, to the 
restrictions contained in the Act made and passed in 
the fifty-third year of His Majesty's reign, intituled, 
"An Act to extend the provisions of an Act made 
and passed in the fifty-second year of His Majesty's 



Further Enlargement of the Army Bill Act. 43 

reign, intituled, "An Act to facilitate the circulation 
of army bills," and to make further regulations 
respecting the same," and that all provisions, regula- 
tions and enactments in the said Acts contained, 
(save and except as aforesaid) and each and every of 
them shall be applied and put in force in respect to 
all and every such army bills so issued, or that may 
hereafter be issued, as fully and effectually to all 
intents and purposes as if the same were severally 
and separately repeated, and herein recited and made 
part of this Act, in so far as the said provisions and 
enactments are not hereinafter altered or repealed. 

II. Provided always, and be it further enacted by 
the authority aforesaid, that the amount of army bills 
in circulation, as well those already made and issued 
as such as may hereafter be made and issued, shall 
not at any one period exceed the sum of fifteen 
hundred thousand pounds, current money of this 
province. 

III. And whereas it is essential for the security 
of the persons who may become possessed of army 
bills to be issued as aforesaid, and in order to assure 
to such persons the advantages conferred on the said 
bills by this Act, and to promote the public confid- 
ence in the said bills, that the aforesaid limitation 
prescribed to the issue of the said bills shall be 
strictly adhered to, and under no circumstances in- 
fringed ; Be it therefore enacted, by the authority 
aforesaid, that the Director of the army bill office, 
the Cashier of the said office, and any other officer or 



44 Further Enlargement of the Army Bill Act. 

officers concerned in the making, signing and issuing 
of the army bills to be issued as aforesaid, for the 
time being, shall in no instance and under no circum- 
stances whatever, make, sign or issue any such army 
bill or army bills, when and so long as the army bills 
in circulation shall amount in value to, and not be less 
than fifteen hundred thousand pounds, current money 
of the Province ; and that if the said Director of the 
army bill office, the Cashier of the said office or any 
other officer or officers concerned in the making, 
signing or issuing of army bills so to be issued as 
aforesaid for the time being, shall make, sign, or issue 
any army bill or army bills after the said army bills 
already issued and to be issued and in circulation at 
the same time, shall amount to fifteen hundred 
thousand pounds, such Director of the army bill 
office, Cashier of the said office, and other officer or 
officers concerned in the making, signing, or issuing 
of army bills beyond that amount, shall thereby be 
rendered incapable of serving His Majesty, in any 
office, civil or military in this Province ; and shall 
moreover severally and respectively forfeit to His 
Majesty, his heirs and successors, the amount of all 
such army bills as shall have been made, signed and 
issued over and beyond the said limitation of fifteen 
hundred thousand pounds, to be recovered by action 
of debt, bill, plaint or information in any of His 
Majesty's courts of Record in this Province; one 
moiety whereof, when recovered, shall be to and for 
the use of our Sovereign Lord the King, his heirs and 



Farther Enlargement of the Army Bill Act. 45 

successors, and the other moiety thereof (with all 
costs of suits) to and for the use of such person or 
persons as shall inform or sue for the same ; and that 
in default of goods, chattels, land and tenements out 
of and from which the money so forfeited ma)' be 
levied, such Director of the army bill office, Cashier, 
officer or officers as aforesaid, against whom judgment 
may be rendered for the money so forfeited, shall be 
taken and conveyed into the common gaol of the 
district in which such judgment shall be rendered, 
and there detained, until he or they, respectively, do 
pay the amount of such judgment, any law, usage, or 
custom to the contrary notwithstanding. 

IV. And be it further enacted by the authority 
aforesaid, that each and every of such army bills, as 
aforesaid, shall and may be received and taken, and 
shall pass and be current to all and every the collec- 
tors and receivers in this Province of Lower Canada, 
of the customs or any revenue or tax whatsoever 
already due or payable, or which shall or may here- 
after be granted, due or payable to His Majesty, his 
heirs and successors, under and by virtue of an}- Act 
of the Parliament of Great Britain, or of the Provincial 
Parliament or otherwise ; and also at the office of the 
Receiver-General of this Province, from the said 
collectors and receivers, or from any other person or 
persons, bodies politic or corporate whatsoever making 
any payments whatsoever to His Majesty, his heirs 
and successors, for, upon any account, causes or 
occasion whatsoever, and that the same in the hands 



46 Further Enlargement of the Army Bill Act. 

of such collectors and receivers, and in the hands of 
the Receiver-General of this Province, shall be deemed 
and taken as if paid in the gold or silver coin passing 
current in this Province, and as such, shall be charged 
against and credited to such collector and receiver, 
and to such Receiver-General as aforesaid, respec- 
tively, in their respective accounts with each other, 
and with His Majesty, his heirs and successors. 

V. And be it further enacted by the authority 
aforesaid, that the interest which from time to time 
shall be due upon any such army bill, as aforesaid, 
shall be allowed to all persons, bodies politic and 
corporate, paying the same to the Receiver-General 
of this Province, or to any collector or receiver of any 
of His Majesty's customs, revenues or taxes up to 
the respective days whereupon such bill or bills shall 
be so paid ; provided always, that every such Receiver- 
General, collectors and receivers as aforesaid, shall be 
accountable for the interest on every such bill by 
them or either of them received, for and during the 
time during which such bill shall remain in their 
hands. 

VI. Imposes penalty on forging bills, and pro- 
vides that such person or persons so forging and 
offending, being thereof lawfully convicted, shall be 
adjudged a felon, and shall suffer as in cases of felony, 
without benefit of clergy. 

VII. Sets forth the penalty in persons stealing 
army bills. 

VIII. Enacts that contracts shall be void in which 



Further Enlargement of the Army Bill Act. 47 

any distinction shall be made between army bills 
and cash. 

IX. Provides that no arrest shall be made if a 
tender in army bills be made. 

X. No attachment shall issue if there be not an 
affidavit of no tender in army bills. 

XI. On capias ad satisfaciendum, a deposit of the 
debt and costs in army bills shall stay proceedings. 

XII. On fieri facias, etc., a deposit of the debt and 
costs in army bills shall stay proceedings. 

XIII. And be it further enacted by the authority 
aforesaid, that of the amount of army bills now in 
circulation, and hereafter to be issued a sum no less 
than two hundred thousand pounds, and not exceed- 
ing five hundred thousand pounds, shall be in bills of 
one, two, three, five and ten dollars, such bills payable 
as those of larger denominations, in bills of exchange 
on London, and not bearing interest, and that the 
holders of such bills shall be entitled to demand, and 
receive at the army bill office on demand, army bills 
of fifty dollars and upwards, bearing interest for the 
amount of all such bills. 

XIV. And be it further enacted by the authority 
aforesaid, that during three months, to be computed 
from the passing of this Act, it shall and may be 
lawful to and for all and every person in possession 
of army bills of the value of twenty-five dollars only, 
bearing interest to have and receive at the army bill 
office on demand, bills of one, two, three, five and ten 
dollars, in exchange for such army bills of twenty- 



48 Further Enlargement of the Army Bill Act. 

five dollars, together with the interest due and payable 
thereon, up to the day of making such exchange. 
Provided always that the Director of the army bill 
office, or those employed under him, in exchanging the 
said army bill, shall not, during the said three months 
next after the passing of this Act, be bound so to 
exchange such army bills to a greater amount in any 
one day than that of two hundred and fifty pounds ; 
provided also, that the same person shall not, in any 
one week, require to be so exchanged, more than one 
army bill of twenty-five dollars, bearing interest as 
aforesaid. 

XV. And be it further enacted, that it shall be 
the duty of the officer or officers to whom it may 
appertain, as having the direction of the army bill 
office, to lay before the commissioners immediately 
after the passing of this Act, a correct account of the 
amount of all such army bills as shall then be in 
circulation, and at each second subsequent meeting 
of the said commissioners, a true and correct account 
of all such bills as shall have been issued and put in 
circulation from the date of the last account rendered, 
in order that the same may be laid before the legisla- 
ture at its next ensuing meeting. 

XVI. Provided always, that nothing in this Act 
contained, shall extend or be construed to extend 
to entitle any holder or holders of any such army 
bills as aforesaid, as ma)', at any time hereafter remain 
unpaid or unsatisfied save and except the holder or 
holders of such army bills as were heretofore issued, 



Further Enlargement of the Army Bill Act 49 

subsequent to the passing of the " Act to facilitate the 
circulation of army bills," and until the same exceeded, 
on the whole, the sum of two hundred and fifty 
thousand pounds, and which now remain unpaid and 
unsatisfied, to receive out of or from any monies that 
there may be in the hands of the Receiver-General 
in this province, or from any monies that may here- 
after come into his hands, arising out of any taxes or 
duties heretofore imposed, or that may hereafter be 
imposed, levied or raised by virtue of any Act of the 
Provincial Legislature, or from the rents and revenues 
of His Majesty's territorial domains in this province, 
or from any other monies in the hands of the 
Receiver-General, payment of any such army bill or 
bills as aforesaid. 

XVII. And be it further enacted, that the director 
of the army bill office, and all and every person or 
persons aiding or assisting him in the issuing of army 
bills over and above the sum of five hundred thou- 
sand pounds, as limited by the Act fifty-third, George 
III., Ch. III., shall be freed, discharged and indemni- 
fied as well against the King's Majesty, his heirs and 
successors, as against all and every other person or 
persons, of, for, or concerning the making and issuing 
of all, any and every such army bills, as shall have 
been so made and issued beyond the said limitation. 

The pacification of Europe did not now appear to 
be a remote issue. The disastrous defeat of the 
French army at Leipsic, and subsequent reverses, 
had weakened the resources of Napoleon. The 

D 



50 Abdication of Napoleon. 

alliance between Austria, Russia and Prussia, proved 
a too formidable combination for him to cope with. 
Wellington was driving Soult from Spain, and British 
troops entered France on the 7th October, 181 3. 
Paris surrendered to the allies on the 31st of March, 
1 8 14. The abdication of Napoleon was negotiated 
at Fontainebleau on the 5th of April, 18 14. Louis 
the XVIII. arrived in Paris on the 3rd of May, and 
on the 4th, Napoleon embarked on board the British 
frigate Undaunted, an exile for Elba. 

Great Britain, in prolonged conflict with France 
and her allies, under so great a leader of armies as 
Napoleon, had become burthened with a heavy debt. 
The bank of England had suspended specie payments. 
Gold in relation to the currency of the realm was at 
a high premium. 

In October, 1S13, the ounce of standard gold stood at £ 5 9s. currency. 

In March, 1814, " " ' : 5 Ss - 

In April, " " " " 5 5 s - " 

In June, " " 4 I03 - 

and the average price for the months of September, October, November 

and December, was ^4.75. currency. 

From February, 1814 to July 18 14, the rate of 
Exchange on London in Quebec for 30 days sight 
bills, was announced by the commissioners from time 
to time at 19% discount, but the prospect of peace 
sent the rate down. The rate of exchange in those 
days was not governed by the balance of trade, but 
by the issue of battles. 



Discount on Treasury Bills. 51 

In August 1st, 1S14, the discount was 16%. 
" 15th. " " 14% 

" 29th, " " I2°/ 

Septr. 1 2th, " "' 10% 

Octr. nth, " " 8% 

" 24th, " " 5% 

Deer. 6th, " ' ; 2j£°/ 

The escape of Napoleon from Elba, on the first of 
March, 1815, and the consequent apprehension of a 
renewal of hostilities, sent the price of gold in England 
again up to £$. ys. ; and in sympathy with the fall in 
the value of current money in England, the discount 
on bills of exchange in Canada rose in July to 15% 
but rallied towards the end of the month, when the 
rate was quoted at 10% discount. 

On the 21st of January, 181 5, at one o'clock, His 
Excellency the Governor-in-Chief came down in 
state to the Legislative Council to open the first 
session of the eighth Parliament. The Gentleman 
Usher of the Black Rod was sent down to the 
Assembly to command the attendance of that House, 
and the members being present, the Honourable 
Speaker of the Legislative Council signified His 
Excellency's pleasure that they should return and 
choose a fit person to be their Speaker, and present 
him to His Excellency on Tuesday the 24th, at one 
o'clock. 

On that day, His Excellency being seated on the 
throne, and the Assembly, with Mr. Papineau, their 
speaker elect, being in attendance below the Bar, the 
Honourable the Speaker of the Legislative Council 



52 Meeting of Parliament. 

expressed His Excellency's allowance of the choice 
of the House of Assembly. 

In the Speech from the throne, His Excellency 
alludes to the reinforcements he had received from 
His Majesty's Government, which enabled him to 
diminish the pressure of war on the inhabitants of 
the Province — and also to the demands of " the public 
service continuing various and large," and that he 
looks to Parliament for continued exertions to meet 
them, — for a renewal of a productive revenue bill, and 
of such of the provisions of the army bill act, as it 
shall be deemed expedient to adopt for the future. 

With reference to the " Act to facilitate the circu- 
lation of army bills " and the two subsequent Acts 
extending the provisions thereof, I may remind my 
readers that the original act provided that a sum of 
fifteen thousand pounds should be forthcoming from 
the Provincial Exchequer, for the payment of interest 
on the first issue of army bills, amounting to two 
hundred and fifty thousand pounds, and also pro- 
vincial security for the ultimate payment of army 
bills to that amount, if such army bills should remain 
unpaid at the expiration of five years. 

The first Act to extend the provisions of the 
original Act, which authorizes an increased issue of 
army bills to the amount of two hundred and fifty 
thousand pounds currency — the whole issue not to 
exceed five hundred thousand pounds, limits the 
whole provision for interest to be paid out of the 
Provincial Exchequer to fifteen thousand pounds 



Provisions of Army Bill Act. 53 

currency per annum, and gives no security or pledge 
for the ultimate payment of arm)- bills beyond that 
for the first issue of two hundred and fifty thousand 
pounds. 

The second Act to extend the provisions of the 
original Act, authorizes an issue, in all, of fifteen 
hundred thousand pounds ; but gives no security for 
the payment of interest on any amount of army bills 
in excess of two hundred and fifty thousand pounds 
as set forth and authorized in the original Act of ist 
of August, 1812. 



CHAPTER III. 

Americans prepare to continue the war — Treaty of peace — Report on 
Army Bills in circulation — Bills lost or destroyed ^9000— Final 
close of the Army Bill Office. 

The Americans contemplated, with no little appre- 
hension, the pacification of Europe which followed 
the defeat of Napoleon at Leipsic and his subsequent 
exile to Elba. They once thought that there would 
be no difficulty in annexing Canada, that the war, 
for them, would be a mere promenade ; but instead 
of annexing Canada, Canada annexed the whole terri- 
tory of Michigan, and administered its civil Govern- 
ment. And now that peace in Europe had apparently 
been restored and had set free the veterans of the 
British army for other service, the Americans con- 
sidered that they had just cause for apprehension. 
The President at once communicated with several 
Governors of States. In July, 1814, he wrote: 
" Great Britain will now have a large disposable force, 
both naval and military, and with it, the means of 
giving the war in America a character of new and 
increased activity and extent ; " and as a measure of 
precaution he deems it advisable to strengthen them- 
selves, and the line of the Atlantic, and invites the 
executive of certain states to organize, and hold in 



Treaty of Peace. 55 

readiness for immediate service, a corps of ninety 
thousand five hundred men. 

In anticipation of a prolonged state of warfare, for 
which the Americans were preparing, the committee 
upon the army bills, report to the House of Assembly 
on Friday the 17th of February, 181 5, that it is ex- 
pedient to renew the provisions of the two Acts with 
some modifications, and to increase the amount of 
army bills which may be in circulation to ,£2,000,000 
currency ; and the house having concurred, a bill was 
read the first time — second reading fixed for Monday 
the 20th. On that day the bill was read again, and 
referred to a general committee for discussion on 
Wednesday the 22nd, when some progress was made : 
the bill to be further discussed on Friday the 24th. 
On Monday the 27th, the committee report the 
amendments, and the house having concurred, it is 
ordered that the bill, thus amended, be engrossed. 
On Tuesday the 28th, the bill, as amended, for facili- 
tating the circulation of army bills, was read a third 
time, and passed the House of Assembly. But the 
bill was thrown out in the Upper House for reasons 
which shall presently appear. 

On the 1st March, 181 5, however, a message was 
received from His Excellency the Governor-in-Chief, 
acquainting the House of the Ratification of the 
Treaty of Peace. This was the Peace of Ghent, 
concluded between Great Britain and the United 
States, made substantially on the status quo ante 
bellum, and signed on the 24th December, 18 14. 



56 Army Bills in Circulation. 

In theCanadian Archives there is the following report 
respecting the working of the Army Bill Act, showing 
the amount of bills in circulation in February, 1815. 

Copy of report re amount of army bills in circula- 
tion in Febuary, 181 5, together with the report of the 

board upon the subject. 

"Quebec, 19th February, 1815. 
" We, the undersigned, having assembled at Your Excellency's desire 
for the purpose of considering the subject of army bills in circulation, 
and having had reference to the several representations your Excellency 
has made to His Majesty's Government thereon, we have great satis- 
faction in stating that all the beneficial effects of the measure which 
have from time to time been anticipated by Your Excellency, have 
been fully realized ; in illustration of which the following calculations 
are submitted. At present there are about ,£800,000 in circulation in 
bills bearing interest, being a total of ,£1,300,000 ; the interest annually 
upon the ,£800,000 at 6 per cent is £48,000, deduct paid by the pro- 
vince £15,000, leaving a balance of £33,000, which is the total interest 
paid from the army extraordinaries for the use of £1, 300,000, being a 
trifle more than 2^ per cent per annum — into this, calculation may 
also be taken to show the advantage derived by the public, that the 
loss upon exchange which has fluctuated from 2% to 22^ per cent, 
discount, has been altogether saved upon the sum now in circulation, 
and what further loss the public must have sustained by the exchange, 
but for the relief afforded by this paper medium, it is not possible to 
calculate, no doubt it would have been enormous ; another advantage 
not to be overlooked, is the facility with which army bills have been 
conveyed to the most remote parts of this extensive command, to meet 
the exigencies of the service at an inconsiderable expense and risk, 
whereas the transport of specie would have been attended with danger, 
delay and heavy cost, besides which, the enemy has been deprived of 
his booty in two instances in his predatory incursions into Upper 
Canada, by the facility with which the contents of the military chests 
at York and Fort George were destroyed, without any loss to the 
public. In explanation of this circumstance it is necessary to observe 
that as the army bills do not become cash by the system adopted, until 
they are issued and dated, and the numbers of the bills having been 



Army Bill Office. 57 

kept by the accountants, they were replaced from the army bill office, 
or a similar amount in lieu thereof. 

Understanding that another bill is in progress in the Provincial 
Legislature now in session, extending the provisions of the former 
Army"Bill Acts, by which a further sum of £500,000 in bills not bear- 
ing interest may be issued, which, added to the ,£1,300,000 at present 
in circulation, will make a total of £1,800,000, reducing thereby the 
interest paid the government for the use of this gross sum to a little 
more than i}( per cent, per annum. 

The total expense of the army bill office establishment for the last 
year, amounted to about £"4.000, £2,500 of which is defrayed by the 
Province, and the remaining £1,500 from the military chest. In all 
probability, this excess of .£1,500 will be more than covered by the 
accidental loss of army bills, which, from the large amount in circu- 
lation, cannot fail of being very considerable. 

In August 181 7, it is provided by the first Army Bill Act that the 
province will no longer pay interest upon army bills that the holders 
may demand specie for them, and that the Governor may at any time 
previous to that period, call in and redeem with specie the army bills 
in circulation ; it is for the consideration of Your Excellency, how far 
it may be expedient to suggest to His Majesty's government to avail 
itself of any favorable circumstance of furnishing specie for this purpose 
upon advantageous terms in the course of the ensuing two years, to 
provide for the redemption of these bills, without waiting the expiration 
of the period prescribed by the Act. 

These suggestions and calculations are submitted for your Excellency's 
consideration, but the inferences we have drawn will be rendered more 
conclusive when the state of public affairs will be known with more 
certainty, when the Army Bill Act shall have passed, when Your 
Excellency shall have received on the 27th inst. the periodical report 
of the commissioners for fixing the rate of exchange, and the next 
monthly account of the amount of bills in circulation from the director 

of the army bill office. 

(Signed) W. II. Robinson, 

Com 5 ' Gen 1 . 
(Signed) J. Hale, 

Dep.- Paymaster Gen'. 
(Signed) Noah Freer, 

Military Secretary. 



58 Extension of Circulation Opposed. 

The bill referred to in the foregoing report as in 
progress in the Provincial Parliament was thrown out 
in the Upper House ; and I find a letter in the Quebec 
Gazette of the 31st March, 181 5, respecting its rejec- 
tion, headed : 

Army Bills. 

The fate of the new Army Bills Act, lately passed by the House of 
Assembly and rejected by the legislative council, having excited public 
curiosity, we are happy in being enabled by a correspondent, to gratify 
our readers with the following observations on that interesting subject. 

The Act of 1814, authorised the issue of army bills up to the ist day 
of February, 1S15, to an amount not exceeding ^1,500,000 currency at 
any one time in circulation. This Act remains in full force in respect 
to all bills issued within the above limits, and will continue in force 
until the end of five years, counting from August 1812, and by the 
monthly returns from the army bill office laid before the legislature, it 
appears, that the above sum of £1, 500,000 was amply sufficient for 
the public service in both provinces, the largest amount stated to be in 
circulation at any period during the last year being only about 
,£1,205,000. 

At the time this Act was passed, the public were suffering for want 
of small money ; a clause was therefore inserted, requiring that, of the 
amount so to be issued, a sum not less than .£200,000 nor more than 
^500,000, should be issued in small bills bearing no interest — and at the 
same time, to guard against the pernicious effects of a superabundance 
of small bills in circulation, a proviso was wisely added, entitling the 
holders of such bills, " to demand and receive at the army bills office, 
on demand, army bills of $50 and upwards, bearing interest for the 
amount of all such bills." This proviso is still in force but was wholly 
omitted in[the new bill. 

Immediately after the passing of this Act on the 17th of March, 
1 8 14, the issue of small bills commenced, and was continued through 
the summer and fall, and by the end of November, it would appear the 
circulation of both Provinces was more than fully supplied, for early in 
the following month we find by the monthly returns, that the public 
began for the first time to avail themselves of the above proviso, by 
bringing in small bills in exchange for large ones. Accordingly it 



Extension of Circulation Opposed. 59 

appears, that between the l2thof December, 1814, and 31st of January, 
1S15, no less than ^43,925 was issued in large notes bearing interest, 
in exchange for small ones. As there is no reason to suppose that 
government exceeded the limits prescribed by the Act, here is plain 
proof that even half a million in small notes was more than sufficient 
for the circulation of both Provinces, seeing that in about ten months 
no less than ^44,000 worth of them were brought back in exchange 
for large bills, exclusive of what were paid in during that period for 
bills of exchange. The presumption therefore is, that a smaller sum 
would have been quite sufficient during the war, and that a still smaller 
sum might suffice during peace. 

Here it may be proper to remark, that the operation of the above 
proviso had the most salutary effect, by counteracting any excessive 
issue of small bills, and to this circumstance, in conjunction with the 
management of the exchange commissioners, may fairly be attributed 
the high and unprecedented degree of credit in which the paper hath 
hitherto been so happily maintained. 

With this experience before our eyes, the object of the framers and 
advocates of the new army bill is altogether inconceivable. It began 
by extending the authority to issue army bills to an amount not exceed- 
i"g ^2,000,000 at any one time in circulation. This extension was 
surely unnecessary in a time of peace ; seeing that the former limits 
afforded more than sufficient for the public service, even during war.. 
But this was not the principal objection to the bill. 

In a subsequent clause it was enacted, that of the amount so to be 
issued, a sum not less than one million should be issued in small notes, 
bearing no interest, and the wise proviso in the former Act, for con- 
verting small notes into large ones, was entirely omitted. This extra- 
ordinary clause having passed in the Assembly, and the bill arrived at 
the third reading, a rider was proposed and agreed to, in that House, 
authorising the Commander of the forces, at any time, to buy up with 
cash, the whole or any part of the army bills bearing interest, whenever 
he might think proper. 

In this shape the bill made its appearance in the Legislative Council, 
where, luckily, the members were too well acquainted with the subject 
to suffer its dangerous imperfections to escape their notice. 

The words " not less than one million " were the first that struck 
their attention. By that clause as it originally stood, government might 



60 Extension of Circulation Opposed. 

have issued the whole two million in small notes, at same time that they 
were authorized by the rider to buy up all the large ones. But a com- 
munication having taken place between the two houses, it was agreed 
to consider the words " not less " as a clerical error, and to substitute 
in their stead the words " not exceeding " which was accordingly done 
in a private way by the two speakers, etc. This was considerable im- 
provement to the clause, but it was liable to insurmountable objections, 
for want of the old proviso so often mentioned, to relieve the circulation 
from superfluous small notes, there being no other mode of redemption 
provided than that of bills of exchange on London, which are only 
wanted by a very small portion of the community, and therefore, the 
issue of small notes to the extent of one million, must inevitably have 
produced a depreciation, seeing by the experience of last year, while the 
war expenditure was going on to its full extent, that even half a million 
was too much. Had the Legislative Council been at liberty to amend 
this bill, by inserting the old proviso for converting the superfluous 
small bills into large ones, everything would have found its level by 
means of that salutary check, and all might have gone well— but unfor- 
tunately, this all along had been considered (very erroneously) as a 
money bill, which the Upper House must not touch, and therefore 
they had no other option than to pass it or reject it. We do not pretend 
to give any report of the debates in council on this subject, but we 
, understand it was very fully discussed during several sittings, and that 
finally the members were unanimous in rejecting the bill, as being 
the safer of the two alternatives. 

The introduction of this paper currency, at the commencement of 
the late war with the United States, as the substitute for specie, at a 
time when there was very little specie in the country, and when the 
public service could not have been carried on without it, was certainly 
a seasonable and judicious experiment, and its unprecedented success 
has not only been a great pecuniary saving to Great Britain, but it has 
also contributed in no small degree to the preservation of these 
Provinces. 

The credit of this paper ought, therefore, to be considered as an 
object of the first importance and carefully supported to the last, being 
a most valuable resource, to be again resorted to by government on 
future occasions in case of need. Mistaken notions of economy in 
attempting to save the interest by buying up the large bills and making 



Extension of Circulation Opposed. 61 

excessive issues of small ones, if carried into practice, would be fraught 
with most dangerous consequences, and ought always to be resisted, 
for when depreciation begins, there is no knowing to what extent it 
may go, and the credit of the paper once lost will be remembered for 
a century to come, and render it impossible again to resume the system 
with any success. 

Finding by experience that this paper is so advantageous to Great 
Britain, while at the same time it affords accommodation to moneyed 
men in this colony, some well-informed persons are of opinion, that it 
would be good policy to continue the system in peace as well as in war, 
and have expressed their surprise that no steps were taken after the 
rejection of the New Army Bill Act, to introduce a short bill, to 
authorize a further issue of army bills for a limited time, under the Act 
of 1814, which it is supposed would have met with no opposition in 
either house, the pro visions of that Act having been found by expe- 
rience to answer every desirable purpose. And we confess we are 
much inclined to this opinion, when we reflect that Great Britain has 
no money lying idle— that on the contrary, she is paying many millions 
annually for the interest of what she owes as a nation, and that she 
cannot send specie or anything else to this country, without adding so 
much, in some shape or other, to her national debt. It is true, the 
legal interest in England is only 5%, while here it is 6%- But it must 
at same time be recollected, that all our paper serves as a substitute for 
specie, that only about two-thirds of what is at present in circulation 
bears interest, and that the Province contributes ,£15.000 per annum 
towards that interest. To this must be added the advance of money 
in England (equal to perhaps six or eight months interest) and the 
ordinary expenses of purchasing and sending out the specie — and it 
must also be recollected that specie as a circulating medium, frequently 
finds its way into the neighbouring States, and therefore requires a 
frequent supply to keep up the requisite quantity, while, on the con- 
trary, our paper remains at home, and requires only a judicious regu- 
lation of the rate of exchange, and due precaution against forgery to 
keep it in full credit. 

Further to illustrate these observations, we have only to present our 
readers with the following statement in round numbers, which, by the 
returns from the army bill office, cannot be very far from the truth. 

Suppose .£1,200,000 in army bills at present in circulation. Of 



62 Extension of Circulation Opposed. 

which £800,000 bears interest at 6%, £48,000, and £400,000 bearing 
no interest, being small bills, £1,200,000. Deduct so much paid by 
the Province £15,000, balance of interest (being only 2^% on 
£1,200,000),— £33,000. Suppose bullion at the mint prices, and that 
Great Britain were to purchase and send out specie for the redemption 
of all these army bills, the expenses in freight on £1,200,000 cannot 
be less than iJ^7o> sav £ 1 $>°°°> one year's interest on £1,200,000 
@ 5%. £6o, 000— £78,000. 

Deduct the foregoing balance of interest £33> 000 

Loss to Great Britain by sending out specie exclusive of the 

risk and advance of money £45> 000 

Thus it appears that Great Britain gets a substitute for specie in 
Canada to the amount of £1,200,000, for which she pays 2^% pet- 
annum, and that it would cost her at least £45,000 to replace that 
substitute with specie ! 

Where can Great Britain get so advantageous a loan? 
But even supposing the whole of our army bills were to bear interest 
—still we are of opinion that they would be advantageous to Great 
Britain, particularly when it is considered, that without them, we should 
require an annual supply of specie to a certain extent, to keep up the 
requisite quantity for circulation. 

Expense of sending out £1,200,000 in specie as above 

stated, including one year's interest £78,000 

£1,200,000 in army bills, all bearing 6% interest. £72, 000 

Deduct so much paid by the Province 15,000 57,°°° 

Balance saved to Great Britain, supposing that all our bills 

bore interest *. 21,000 

Again we may ask where can Great Britain obtain a cheaper loan ? 
N.B. What is meant by the " advance of money " is the difference 
between the time when money would be paid in England for the 
purchase of specie to send here, and the time at which bills drawn here 
for the public service get home and become due, which, in the ordinary 
course, is found on an average to be six or eight months — and the 
interest for that time is of course so much more to be added in favour of 
our army bills, which are only issued when they are wanted, and Great 
Britain is so much more the gainer. It would be easy to prove that at 
least half a million has been saved to Great Britain in one way or other, 
by means of our army bills up to this date.— Quebec, 24th March, 1S15. 



Amount of Army Hills in Circulation. 63 

The following statements relating to the circulation 
of the army bills, copied from official documents in 
the Canadian Archives Bureau, will prove inter- 
esting to professional bankers. 

Circulation of Army Bills. ARMy ^ QfficEj 

24th April, 1815. 
Account of the Amount of Army Bills in Circulation. 
Balance of army bills remaining in circulation the 27th 

March, 1S15 ,£1,249,996 5 

Deduct : — 
So much redeemed by bills of exchange on London 
since the 27th March, 1815, viz.: — 

In large bills £ 43 15 

In small bills 3.594 5 £ 3. 6 jS o 

175 four dollar bills, worn out, have been 

redeemed with specie since last report 175 o 

459 one dollar bills, rendered useless by 
wear, have also been redeemed since last 

report 114 15 

The following bills have been redeemed at, 
and received from the military chest at 
Montreal, viz. : — 

19,463 bills at 4 dollars .£19,463 o 

56,354 bills at 1 dollar i4,oS8 10 33,551 10 

117 bills at 10 dollars \ Of the new issue of 

small bills rendered 

useless by wear, or 

v otherwise, have been 

J redeemed between 

I the 27th March and 

2,640 dollars 24th April, 1815... 660 £38,139 5 

Balance of army bills remaining in circulation the 24th 

April, 1815 £1,211,857 O 

To the Commissioners (Signed) James Green, 

for fixing the rate of exchange, Director. 

&c. &c. &c. 



137 " 


" 5 


105 " 


" 3 


Si " 


" 2 


30S " 


" 1 



64 Amount of Army Bills in Circulation. 

Circulation of Army Bills. 

Army Bill Office, 

22nd May, 1815. 

Account of the Amount of Army Bills in Circulation. 

Balance of army bills remaining in circulation the 24th 

April, 18 15 £1,211,857 o 

Deduct : — 
So much redeemed by bills of exchange on London 
since the 24th April, 1815, viz.: — 

In large bills £ S31 5 

In small bills 2,932 5 

£3.763 10 

150 four dollar bills, worn out, have been 

redeemed with specie since last report 150 

708 one dollar bills, rendered useless by wear, 
have also been redeemed since last report. . . 177 o 
64 bills at 10 dollars' 



5S ' ; " 5 " 
no " " 3 " 
209 " " 2 " 
619 " " 1 
Affidavit 
before the 
Judges. . . 1 



Of the new issue of 
small bills rendered 
useless by wear, or 
y otherwise, have been 
redeemed between the 
24th April and 22nd 
May, 1S15 



574 10 £4.665 o 



2,298 dollars^ 
Balance of army bills remaining in circulation the 22nd 
May, 1815 , £1,207,192 



To the Commissioners 
for fixing the rate of exchange, 
&c. &c. &c. 



(Signed) James Green, 

Director. 



Amount of Army Bills in Circulation. 65 

Circulation of Army Bills. 

Army Bill Office, 

19th June, 181 5. 

Account of the Amount of Army Bills in Circulation. 



Balance of army bills remaining in circulation the 22nd 

May, 1815 ,£1,207,192 o 

Deduct : — 

So much redeemed by bills of exchange on London 
since the 22nd May, 1815, viz. : — 

In large bills .£13,512 IO 

Four dollar bills worn out have been re- 
redeemed with specie since last report 

One dollar bills rendered useless by wear 

have also been redeemed since last report.. . 

30 Bills at 10 dollars") 

8 " " 5 " 



26 " " 3 
79 " " 2 
18 " " 1 

Affidavit 
before the 
Judges. .. 



Of the new issue of 
small bills rendered 
useless by wear, or 
> otherwise, have been 
redeemed between 
the 22nd May and 
19th June, 1815. 

594 dollars^ 

Balance of army bills remaining in circulation the 19th 
J une > l8l S ^1,193.531 o 



148 10 ,£13,661 o 



To the Commissioners 
for fixing the rate of exchange, 
&c. &c. &c. 



(Signed) James Green, 

Director. 



66 Amount of Army Bills in Circulation. 

Circulation of Army Bills. 

Army Bill Office. 

nth September, 1S15. 

Account of the Amount of Army Bills in Circulation. 

Balance of army bills remaining in circulation the 14th 

August, 1815 £ 628,792 15 

Deduct : — 
So much redeemed by bills of exchange on London 
since the 14th August, 181 5, viz. : — 

In large bills ^75> I2 S ° 

In small bills 47> 2 4° ° 



£122,365 o 



976 four dollar bills, worn out, have been 

redeemed with specie since last report 

4294 one dollar bills, rendered useless by 
wear, have also been redeemed since last 

report . • • 

— Bills at 10 dollars^ 
_ " " 5 " 



976 



1,073 10 



Of the new issue of 
small bills rendered 
useless by wear, or 
otherwise, have been 
redeemed between 
the 14th August and 
I 1 th September, 
1815 Affidavit 



Affidavits 
before the 

J ud g es 6 " 1815 Affidavit 1 10 £124.416 o 

6 dollars^ 

Balance of army bills remaining in circulation the nth 

September, 1815 £ 5°4.376 1. 



To the Commissioners 
for fixing the rate of exchange 
&c. &c. &c. 



(Signed) James Green, 

Director. 






Amount of Army Bills in Circulation. 67 

Circulation of Army Bills. 

Army Bill Office, 

9th October, 1815. 

Account of the Amount of Army Bills in Circulation. 

Balance of army bills remaining in circulation the nth 

September, 1815 £5°4.37° 15 

No large or ten dollar bills issued since nth 
September, 1S15. 

Deduct : — 
So much redeemed by bills of exchange on London since 
the nth September, 1815, viz.: — 

In large bills ^43.33' 5 

In small bills 25,649 ^68,980 5 

240 four dollar bills, worn out, have been 

redeemed with specie since last report 240 o 

663 one dollar bills, rendered useless by 
wear, have also been redeemed since last 
report 165 15 69,386 o 

Balance of army bills remaining in circulation the 91I1 

October, 1815 ^434, 99° 1 5 

To the Commissioners (Signed) James Green, 

for fixing the rate of exchange, Director. 

&c. &c. &c. 



G8 Amount of Army Bills in Circulation. 

Circulation of Army Bills. 

Army Bill Office, 

6th November, 1815. 

Account of the Amount of Army Bills in Circulation. 

Balance of army bills remaining in circulation the 9th 

October, 181 5 -£434-99° r 5 

No large or ten dollar bills since that date 

Deduct : — 
So much redeemed by bills of exchange on London since 
the 9th October, 1815, viz.: — 

In large bills ;£i6,943 '5 

In small bills 10,695 IO 

,£27,639 5 

94 four dollar bills, worn out, have been 

redeemed with specie since last report 94 ° 

426 one dollar bills, rendered useless by 
wear, have also been redeemed since last 
report 106 10 27,839 15 

Balance of army bills remaining in circulation the 6th 

November, 181 5 ^407,151 o 

To the Commissioners (Signed) James Green, 

for fixing the rate of exchange, Director. 

&c. &c. &c. 



Army Bills Redeemed. 69 

General abstract of statements shewing the manner in which the sum 
of £88,962 10. currency, imprested to me by warrants from His 
Excellency Sir George Prevost, and His Excellency Sir Gordon 
Drummond, between the nth October, 1814 and 24th August, 1815, 
has been appropriated. 

A. Statement of one dollar bills redeemed between the 13th 
September, 1814, and 6th November, 181 5 inclusive, 
your reports transmitted to the Commissary-General 
from time to time, in conformity to instructions from 
His Excellency Sir George Prevost, Governor-in-Chief 

and Commander of the forces £16,029 5 

B. Statement of four dollar bills redeemed within the above 
period, and reported to the Commissary-General I4>3^i 

C. Statement of bills of 10, 5, 3, 2 and 1 dollars, of the last 
emission, rendered useless by wear, or otherwise, which 
have been redeemed within the same period, and re- 
ported to the Commissary-General as above 8,879 o 

D. Statement showing how the sum of £48,962 10. cur- 
rency, has been appropriated, which I received for the 
purpose of exchanging small notes with bills bearing 

interest of 400, 100 and 50 dollars each 48,962 10 

E. Statement showing the number ' of counterfeit bills 
which were discovered in the military chest at Quebec 
and redeemed by me with specie, paid to John Hale, 
Esq., Deputy Paymaster-General, pursuant to the mili- 
tary Secretary's letter, dated Head Quarters, Montreal, 

16th November, 1814 39 IO 

£88,291 5 
Balance remaining in my hands on the 6th November, 
181 5, for the purpose of daily changing small notes of 

the above description 617 5 

£88,908 10 

Errors excepted. (Signed) Jam es Green, 

Army Bill Office, Director. 

22nd Nov., 1S15. 



70 Army Bills in Circulation. 

Circulation of Army Bills. 

Army Bill Office, 

4th December, 1815. 

Account of the Amount of Army Bills in Circulation. 

Balance of army bills remaining in circulation the 6th 

November, 181 5 ,£407,151 

No issue of large or ten dollar bills since that date 

Deduct : — 
So much redeemed by bills of exchange on London since 
the 6th November, 1815, viz : — 

In large bills ^1,187 10 

In small bills. 4-S& 2 *5 £S>77° 5 

So much redeemed by specie, commencing 
the 24th November, 1815. 

In large bills ^3. 3^ 15 

In small bills Soi 15^4,120 10 

174 four dollar bills, worn out, have been re- 
deemed with specie since last report 174 o 

1 23 1 one dollar bills, rendered useless by wear, 

have also been redeemed since last report .... 307 15 ^10,372 10 

Balance of army bills remaining in circulation 

the 4th December, 1815 ^396,77 8 IO 

To the Commissioners (Signed) James Green, 

for fixing the rate of exchange, Director. 

&c. &c. &c. 



Army Bills in Circulation. 71 

MEMO.— Letter from James Green, Director, dated 18th December, 

1815, asking for further warrant for £10,000 currency, to pay interest 
on army bills. 

Report of Circulation, 1st January, 1816, gives balance in circulation 
4 th December, 1S15, £396,77S o; from which deduct bills redeemed 
to 1st January, £65,281 15 ; leaving a balance in circulation 1st Jan., 

1816, of £331,496 15- 

Report of Circulation, 29th January, 1816, says, balance in circula- 
tion 1st January, 1816, £331,496 15 5 from which deduct bills redeemed 
to 29th January, 1816, £30,213 ; leaving a balance of army bills 
remaining in circulation the 29th January, 1816, of £301,283 15. 

Report of Circulation, 26th February, 18 16, says, balance in circula- 
tion 29th January, £301,283 15 ; deduct bills redeemed, £21,563 15 ; 
leaving a balance of £279,720 o. 

Report of Circulation, 25th March, 1816, says, from balance 26th 
February, deduct in bills redeemed, £36,970 10 ; leaving balance of 
£242,749 10. 

Report of Circulation, 22nd April, 1816, says, from balance 25th 
March, deduct in bills redeemed, £16,678 ; leaving a balance of 
£226,071 10. 

Report of Circulation, 20th May, 1816, says, from balance in circu- 
lation 22nd April, 1816, deduct in bills redeemed, £28,096 15; leaving 
a balance of £197,974 15. 

Memo.— From a letter signed James Jackson, dated 3rd June, 1816, 
to Lt.-Col. Fulton, I see that the value of a silver shilling at that time 
was 25 coppers. 

Note. — In a letter from Geo. Wood, Com.-Genl., dated 8th 
October, 1818, to Major Bowles, Mil. Secretary, he states that during 
the summer of 1818, the rate of exchange for public bills was at par, 
while private bills had uniformly been below par, from one to three 
per cent., the demand for public bills having been very large. 

Note.— From a letter dated 9th December, 1818, I find that the 
rate at which the dollar was issued to the troops was 4s. 8d. 

Note. — From a proclamation issued by His Grace Charles Duke of 
Richmond, Lennox and Aubigny, Commander of the forces in Canada 
and British North America, dated 17th December, 1818, I find that 
the date of closing the army bill office was enlarged to the 1st April, 
1819. 



72 £9,000 Lost or Destroyed—Consequent Gain. 

Note.— Letter from James Green, Director, asking for continuance 
of army bill office to 1st August, [820, as it had been accurately ascer- 
tained that there remained to the Crown a saving of nine thousand 
pounds and upwards on bills lost or destroyed to that amount, and he 
wished to have time to carry the affairs of that office to a satisfactory 
close, as was usual with other public offices similarly situated. (Date 
of letter, 19th May, 1819.) 

Office continued to six months after 1st August, 1S19, by sanction of 
War Department (Treasury Chambers). 

Memo.— Grand total of the number of army bills issued, viz. :— 

Bills at 400 dollars each 5,500. . . .£550,000 

" " 'oo " " 34.606 865,150 

'5° ' 63.914 79^,925 

2 5 92,726.... 579,537 10 

£2,793,612 10 

10 " " 127,600 ,£319,000 

5 " " "j 2,000.. • 90,000 

3 " 64,000 .. . 48,000 

" 2 " " 106,500.... 53,250 

1 ' 165,000 41,250 .£551,500 o 

Bills redeemed with ) at 4 dollars 52,131.... 52,131 

specie only J at I dollar. 179,000 44,75° 96,SSi o 

Tolal £3.441,993 10 

Note. — Army bill office is ordered to be continued to 1st August, 
1820. Army bill office is ordered to be continued to 24th December, 
1820. From a letter, dated Treasury Chambers, 23rd October, 1820, 
the army bill office was finally closed 24th December, 1820, Mr. Green 
paying into the hands of Commissary-General Wood the balance 
remaining in his hands to pay interest, namely, £819 13s. 7d. currency, 
at the rate of 5s. currency to the dollar. 

From the 1st of January, 181 5, to the 23rd Novem- 
ber, when notice was given of the intention of the 
government to redeem the army bills in circulation, 
there is no official notice respecting the rate of 



Rate of Exchange in 1S15. 73 

exchange for bills on London at 30 days sight. 
Neither can I find any quotation in the newspapers 
of the day, save one in the Quebec Gazette of the 
14th September, 1815, under the head of "money," 
which is as follows : 

" For sale at par, for cash ; a few government bills 
of ^300 and ;£ioo sterling, at thirty days on London. 
Apply to the Editor." 

The pacification of Europe had effected a great 
change in the value of bills drawn on the treasury in 
London. As the demand for such bills appears to 
have been limited in Canada, resort was had to the 
Boston and New York markets. The following 
correspondence, however, shows that financial opera- 
tions in the United States, for the purpose of procuring 
specie to meet the exigencies of the public service 
in Canada, were attended with no little difficulty. 
The Commissary-General writes to the Military 
Secretary as follows : 

Commissary-General's Office, 

Quebec, 15th May, 1S15. 
Sir, 

I have the honour to report to you, for the information of His 
Excellency the Lt. -General Commanding, that I have this day received 
letters from Dy. Asst. Corny. -General Wybault, dated New York, the 
3rd inst.j in which he states, on the subject of his mission, that exchange 
at that place is at 4 per cent, discount, and that as the banks to the 
southward of Massachusetts have not yet commenced paying out specie, 
it is at a premium of four p. cent, at New York, making a loss of 8 per 
cent, on negociation, and it appears there would be the same loss at 
Boston. Mr. Wybault regrets that lie is directed to sell bills for specie, 
as that will betray the secret of his mission. The first bill he attempts 



7-4 Premium on Specie. 

to sell, and the knowledge that he has bills for sale, will at once reduce 
the price, as it will naturally be supposed he requires a very large 
sum ; besides, as there will be a premium on the specie, the discount 
on the bills, if paid for in specie, will appear much higher than the 
current rate, which, for obvious reasons, ought not to be the case ; 
under these circumstances, and considering our extreme distress for 
money, not having a thousand pounds in the Canadas, without a chance 
of being relieved by an importation from England to any great extent, 
in consequence of the reports we have lately received through the 
press of extraordinary events in Europe, I beg to submit to His Excel- 
lency whether Mr. Wybault should not be directed to procure specie for 
the government bills in his possession upon the best terms he can effect 
the negociation ; receiving in payment American bank notes and then 
exchanging them for specie, making the real exchange upon the bills, 
and charging the premium upon the specie in his account of disburse- 
ments, with expenses of transportation and other charges generally 
attending the transaction. I trust you will be pleased to lay this letter 
before His Excellency, that I may be honoured with his commands as 
early as possible. 

I have the honor to be, Sir, 

Your most obedient humble servant, 
To Major O. Foster, (Signed) W. H. Robinson, 

Military Secretary. Corny. -Genl. 

[From Canadian Archives, Series C 331, page 98.] 



Copy of Letter re Bringing Specie into Country. 

Halifax, 9th June, 1815. 
Sir, 

Finding that Commissary-General Robinson had written to the 
Deputy Commissary -General here, representing the very pressing 
demand for specie in the Canadas, I have made every exertion to afford 
you a supply, which I could not have been able to do but by obtaining 
a loan rom the Naval Storekeeper ; with the assistance of which I 
have directed to be shipped on board H.M.S. Bulwark ,£30,000 con- 
signed to Mr. Robinson. 

I think it right to apprise you of our poverty, that you may not place 



Rate of Exchange for Bills on London. 75 

too much reliance on supplies from hence. At the same time I shall 

always be willing to make every exertion to afford you all the aid in 

my power. 

I have the honour to be, Sir, 

Your most obedient humble servant, 

(Signed) J. C. Sherbrooke, 

Lt. -General. 

Those letters were written after the news of the 
escape of Napoleon from Elba had reached this side 
of the Atlantic. All Europe was astir with excite- 
ment over his escape ; and the consequent certainty 
of war had a depressing effect upon the rate of 
exchange. Bills on the Treasury were quoted at 
12% discount. But Waterloo brought peace. Bills 
on London rose in value ; and the discount on 
30 days sight bills was reduced to i l /> to 2°/ Q 
in Boston, at which rate it stood in October 18 15, 
and continued at from 2% to 3% discount, till the 
17th of April, 1 8 16, when a temporary increase in 
the rate occurred. 

The quotations in New York for Bills on London 
were rather misleading. They were quoted at a 
premium of from 10 % to 12% ; but a correspondent 
in Halifax of the Quebec Gazette, enlightens the 
public on the subject. The letter is dated /th 
October, 18 15, and is headed Bills of Exchange. 
" By the late arrivals from New York, we observe 
that Exchange on England is quoted at a Premium 
of from 10 to 12%, which causes much more specu- 
lation in this place. A person, unacquainted with 
the mode of transacting business in New York, would 



76 Price of Gold in England. 

naturally infer that specie of some kind was the 
equivalent, and at the quoted Premium ; but their 
insolvent Bank paper is the payment — which paper 
is at a discount of 14% for silver or gold, conse- 
quently Bills on England, which are nominally at 10 
to 12°/ Premium, may be bought in New York by 
sending on hard coin at a discount." 

The price of gold in England from January, 18 16, 
to June 9th of the same year, did not average over 
£4. is. 6d. currency, the mint price as I have before 
stated being £3 17s. io^d. per ounce; and from 
June to January 18 17, the average for currency was 
£3 19s. The Bank of England, however, did not 
resume specie payments till 1823 ; but the difference 
between the price of gold in the currency of the 
country, and the mint price per ounce, seldom ex- 
ceeded 2S. 66. during the last years, i.e. from 181 7 
to 1823. 

A plentiful supply of specie appears to have reached 
the Treasury in Quebec at last ; for in November it 
was announced that the army bills would be redeemed 
in cash. The following is the announcement : — 

PROCLAMATION. 

On the 23rd November, 1815, by His Excellency Sir Gordon 
Drummond, Commanding His Majesty's Forces, and Administrator-in- 
Chief of the Governments of Upper and Lower Canada. 

Whereas, heretofore, for the purposes of maintaining the means of 
circulation and answering the exigencies of the public service, His 
Excellency Sir George Prevost, Baronet, then Commanding His 
Majesty's Forces in British North America, did make and prepare a 
number of bills denominated army bills, and caused the same from 



Redemption in Specie of Army Bills. 77 

time to time to be issued from the army bill office, established for that 
purpose at the City of Quebec, agreeably to the provisions of the 
several acts made for the purpose of facilitating the circulation of army 
bills: And whereas, in and by the said acts, it is, amongst other things, 
enacted, that all interest upon such army bills shall cease from and ' 
after the fourteenth day, next after the day on which the same, by any 
proclamation or other public requisition by the Commander of His 
Majesty's forces for the time being, shall be called in, to be redeemed 
in cash : I have, therefore, thought fit to issue this Proclamation, and 
hereby do signify and make known, to all whom it may concern, 
that all Army Bills heretofore issued, and at present in circulation, are 
called in, to be redeemed in cash, at the said Army Bill Office, in the 
said City of Quebec; and that all Interest upon such Bills as aforesaid, 
shall cease from and after the fourteenth day next after the date of 
these presents. Of all which the Officers of His Majesty's Govern- 
ment, and generally all to whom these presents shall come, or may in 
any wise concern, are hereby required to take notice and govern them- 
selves accordingly. 

On the 20th of December, 1S15, His Excellency 
Sir Gordon Drummond called Parliament together for 
the Despatch of business; and in his Speech from the 
Throne, he alluded to the army bills as follows : — 

" You have had the satisfaction of seeing that the 
Executive Government has completely redeemed its 
pledge to the Public, by calling in and paying in 
cash the army bills which were in circulation." 

To which the House replies : — ■ 

"We have seen with great satisfaction, that the 
Executive Government has completely redeemed its 
pledge to the Public, by calling in and paying in 
Cash the Army Bills which were in circulation. A 
measure which exemplifies, in a most striking manner, 
the national good faith, and which will, we trust, 



78 Meeting of Parliament. 

facilitate similar arrangements hereafter, should the 
Public interests ever require a renewal of them." 

At the Provincial Parliament held at Quebec on 
the 15th of January, 18 17, the Fifteenth section of 
the original Act prohibiting the exportation of specie 
and bullion from the Province, for a period of five 
years from the 1st August, 181 2, was repealed. 

And it was provided that the Army Bill Office 
should be continued for a limited period beyond the 
1st of August, 1 81 7, for the purposes of calling in 
and cancelling and paying all Army Bills that might 
remain in circulation after the 1st of August ; and 
that it should be lawful for the Governor to issue his 
warrant for a sum not exceeding seven hundred and 
fifty pounds currency, for the payment of such officers 
in the Army Bill Office as it may be found necessary 
to continue in the service till the 1st of August, 1818, 
for the purposes aforesaid. 

But the date of closing was enlarged to the 1st of 
April, 1 8 19 ; and further to the 24th December, 1820, 
when the Army Bill Office was finally closed. 

This ends my exposition of the Army Bill Act, by 
means of which the exigencies of the public service 
were provided for during the war of 181 2, a war which 
was entered upon by the British with the greatest 
reluctance ; but which was forced upon them by the 
Americans, with the ostensible object of establishing 
the principle that the Flag covers the merchandise, 
and the right of search for seamen who have deserted 
is inadmissible ; but really, " to wrest from Great 



Conclusion. 79 

Britain the Canadas, and, in conjunction with Napo- 
leon, to extinguish its maritime power and Colonial 
Empire." * 

I have now the pleasure of stating that I am in- 
debted to Mr. George Bethune of the branch of the 
Quebec Bank in Ottawa, for important information on 
the subject of this paper, which he obtained in the 
Archives Bureau at Ottawa ; and to the kindness 
of Mr. Douglas Brymner of that office, in directing 
him to records relating to operations under the Act. 

* Alison's History. 



MONTREAL: 
'WITNESS' PRINTING HOUSE. 



^L 



